Iowa Electronic Markets
The Iowa Electronic Markets (IEM) are a group of real-money prediction markets/futures markets operated by the University of Iowa Tippie College of Business. Unlike normal futures markets, the IEM is not-for-profit; the markets are run for educational and research purposes.

Overview 
The IEM allows traders to buy and sell contracts based on, among other things, political election results and economic indicators. Some markets are only available to academic traders. The IEM also trades futures based on financial markets, such as whether the Fed Funds rate will be raised at the following meeting.

The IEM has often been used to predict the results of political elections with a greater accuracy than traditional polls.

A precursor to the IEM was the Iowa Political Stock Market (IPSM), invented by George Neumann, and developed by Robert E. Forsythe, Forrest Nelson, and George Neumann.

Rules and limits 
The IEM is neither regulated by the U.S. Commodity Futures Trading Commission (CFTC) nor by any other agency due to its academic focus and the small sums that are involved. Indeed, the IEM has received two no-action letters that extend no‑action relief. A speculator may put at risk in the IEM only between $5 and $500. In contrast, other future markets like Nadex are regulated by the CFTC and allow speculators to take on or financially offset significant amounts of risk regarding economic events or the prices of commodities.

See also
The Wisdom of Crowds
NewsFutures
Intrade
TradeSports
PredictIt

References

Further reading
 Surowiecki, James (2004). The Wisdom of Crowds: Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations Little, Brown 
 Thompson, Donald N. (2012). Oracles: How Prediction Markets Turn Employees into Visionaries Harvard Business Review Press

External links
The Iowa Electronic Markets website
Graphs for 2008 US Presidential Election Markets
A Market for Playing the 2 Candidates, (about the IPSM) The New York Times, 1992
The "Election Futures Market": More Accurate Than Polls?, Businessweek, 1996
Porkbellies and Politics, TheStreet.com, 2000
Bookies seen outbidding election polls: Betting sites better at predicting winner, economists claim, MSNBC, 2004
The Iowa Electronic Markets are still going for Bush, Salon.com, 2004
Iowa 'futures' show Republican weakness, CNN, 2006
PollyVote - Forecasting the U.S. Presidential Election

Prediction markets
University of Iowa