When Cantor Fitzgerald's Cantor Futures Exchange opens its online movie futures market next month, Hollywood will become more like the NFL: a sport that gamblers can bet on, with investors placing over/under wagers on box office performance.

Here's how it will work. Say Cantor -- which owns of the Hollywood Stock Exchange, used for entertainment purposes only -- sets the baseline for an upcoming action flick at $100 million. If you go long for $100 and the movie grosses $150 million, you earn a $50 profit. Go short, and if the box office comes in below $100 million, you win that way too. Of course, if you predict incorrectly, you lose. Sounds an awful lot like gambling on sporting events.

A few professional sports bettors, in fact, have thoughts on how to be a winner on the Cantor Futures Exchange. "Don't pick the obvious," says Alan Boston, a veteran sports bettor who specializes in college basketball. "If a company is paying a big cat like Tom Cruise to do a movie, you can already figure the movie's going to be pretty special -- and that will be factored into the price. I'd be looking more for the next Donnie Darko: a potential sleeper that looks a little strange and isn't expected to do very well. Or else focus on the cult director who's suddenly been given a major opportunity."

Cult Directors: Go Short

And if you're thinking of betting on such a film, by a cult director like Richard Linklater, Boston suggests going short. "He's an original thinker who just doesn't ever seem to click," Boston says. "Linklater is sort of the movie equivalent of the Minnesota Twins: You root like hell for them, they do everything right, and they just can't get over the hump."

Luke Kim, a Wharton graduate and former Wall Streeter who's found success at poker and blackjack, suggests a more analytical approach. "The first thing I'd do is hire a bunch of MIT guys to model the movie business," he says. Some highly successful sports bettors use computer software programmed with hundreds of thousands of variables and constantly updated, Kim says.

Get In Early

"I'd have the programmers factor in everything from the director to the genre to correlations between the success of certain types of movies and the overall economy," he says. "If the market for this gets big, people will bet on it in a serious way. It might become like weather futures, where it initially seems like a joke but goes on to become a big deal. I can see there being alternative funds that deal in this."

An expert on both financial markets and the gambler's mentality, Kim advises anyone who thinks he has a distinct edge or gray-area information to jump in early, while movie futures remain inefficient and not overly governed. "Before it gets too regulated, you can expect people to rape the money out of it," Kim says. "If this market exists five years from now, I guarantee there will be notable restrictions that just don't exist now." That sounds like something you can bet on.

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