With speculation running rampant that Prime Minister Stephen Harper is about to call a federal election, business professors at the University of British Columbia are putting the final touches on a research project that could net savvy voters a tidy profit once ballots are cast.

They're setting up a stock market that will let anyone purchase and trade contracts representing the fortunes of the national political parties. The UBC-Election Stock market (UBC-ESM) will be a real-time, online futures markets that will allow investors to buy and sell shares based on what they predict will be the final results of the election. The value of a stock will be determined by what investors are willing to pay for it.

Although the UBC-ESM is set up for research purposes (it will create no profit for the university), investors can make -- or lose -- big money. The investment limit is $1,000, and during the last election, 380 people invested about $96,000.

It will be like any other stock market, says Werner Antweiler, one of the professors behind the project.

"You want to buy cheap and sell high," he told CTV.ca in a phone interview from Vancouver.

He says the UBC-ESM is a better predictor of an election outcome than polling. Pollsters, he says, ask people how they will vote. But investors are more interested in making money and so will try to honestly assess what they think the outcome will be.

"Your pocketbook is closer to your heart than your political preference ... it's a truth revelation mechanism," Antweiler said.

The UBC-ESM will be composed of four markets. Investors can speculate on:

• the share of the popular vote they think each party will get
• the proportion of seats each party will get
• whether or not there will be a majority government and who it will be
• a plurality market which will simply pit the Liberals against the Conservatives

Antweiler says that speculators should see the UBC-ESM like any other futures market. Instead of trading pork belly futures, for example, investors are trading political party election result fortunes. It's not as simple as a hockey pool or betting, he says.

"With a bet, you're kind of locked in. With (the UBC-ESM), if you see the fortunes of a party falling, you're going to sell."

The UBC-ESM has been operating since 1993 and was based on a similar concept created at a university in the U.S. Antweiler says it's had a proven track-record when it comes to predicting election outcomes. It was only a few seats off behind the final tallies of the 2,000 and 1997 federal elections.

In the last national vote, Antweiler says the UBC-ESM was second among Canada's pollsters and researchers in predicting the popular vote outcome. It tied for top spot in correctly foretelling the final parliamentary seat tally.

Antweiler says that at its core the market's true value isn't the money that investors can potentially make if they invest wisely. He and his colleagues see it as a gold mine for their research into investor habits and trading behaviour.

For investors, there's the benefit of learning about investment markets and Canada's political culture.

"What the market does is turn apolitical people into political people. You'll follow the market very carefully when your money is involved," Antweiler said.

(SOURCE: http://esm.ubc.ca/CA06/)