Saturday, May 28, 2016

The polls still have the UK's referendum close but the market doesn't

The Economist’s “Brexit” poll-tracker has it close again.

The market doesn't. On Betfair:
In favour of staying in EU $1.23
In favour of leaving EU $5.10

Friday, May 20, 2016

Peter Brent - a twitterer with the courage of his convictions

I don't know why Peter Brent's mumble blog no longer appears on the website of The Australian. Perhaps his commentary was too intelligent and interesting. Whatever. He has not stopped making his insights public on other sites with his twitter site providing the best link to find them.
I particularly like his courage in putting his predictions about the forthcoming election on the record with a list of what he describes as: "Election bets. Worry not, just small amounts. Needless to say, I don't consider a win in each likely, just good odds."


What a pity that the overwhelming majority of political pundits are not prepared to put their pontifications to the test.
At the moment I am cowardly in that majority category - see my piece yesterday Money keeps coming for the Coalition to win Australian election

Thursday, May 19, 2016

Money keeps coming for the Coalition to win Australian election

I look at the signals of a weakening economy show by ABS figures on low wages growth and the decline in the number of hours being worked. I note that the Reserve Bank felt growth stalling to the extent that a further interest rate cut was needed. I see most of the opinion polls now putting Labor in a winning position. But still the market shows the Coalition is a firm and shortening favourite to be returned on 2 July.
William Hill put it this way in a press release earlier in the week:

  • Election Betting Watch – 19/05
  •  
  • Midway through the second week of Election 2016 and the money has poured in for the Coalition to be returned.
  • “Punters have backed the Coalition from $1.40 to $1.28 over the first 10 days of the campaign,” a William Hill spokesperson said.
  • “One punter has had $40,000 on at $1.30 while we have written a number of other four-figure bets for Malcolm Turnbull to be heading back to the lodge.
  • “The polls have certainly been favourable to the Coalition and Australia rarely throws out a government after one-term.”
  • The ALP have drifted from $3.30 to $3.60 with little interest in Bill Shorten pulling off a monumental upset.
  • Coalition Big Bets
  • $40,000 @ $1.30
  • $3,000 @ $1.30
  • $1,000 @ $1.30
  • ALP Big Bets
  • There has been little interest in Labor but there was still some action on the ALP.
  • $500 @ $3.55
  • $400 @ $3.40
  • $200 @ $3.70
  •  
  • https://www.williamhill.com.au/elections/5252054/d/australian-federal-election


To me it doesn't make sense but experience over the years has taught me that the market is hard to beat.
Hence the lack of action by me on this election.

An alternative view to mine on the UK leaving the EU

For a different perspective to mine on the prospective outcome of the UK referendum on whether to leave or stay in the European Union: Why REMAIN, even at the very tight odds currently available, is a value bet.
It is an interesting assessment of why the opinion polls I have relied to have my $50 on the Brexit option might not be telling the true story. It concludes thus:

The mood music of the camps

It is fair to say that neither camp has exuded an image of confidence. Remain’s warnings have been shrill, while Leave have issued wild attacks on the integrity of those voicing inconvenient views. Both Nigel Farage and Boris Johnson have been lured into discussing a rerun of the referendum if Remain secures a narrow victory, which suggests that they feel that the campaign is ebbing away from them.

The lack of confidence in both camps and the impression that Leave thinks it is behind can be explained by the two sides’ different aims. Leave wants to get to 50%+1. Remain wants to settle the debate for a generation. It is entirely possible that both will be thwarted in their aim and that both believe that on their own terms they will fail.

If you agree, the 5/6 offered by Ladbrokes that Leave will secure over 44.5% of the vote looks fair value, and I’ve backed this bet. If you’re betting on the main event, anything like 1/4 offered on Remain looks an excellent price and you are unlikely to get much better value in the absence of an unexpected development. Take it.

Saturday, May 14, 2016

UK to leave European Union?


The common assumption is that when politicians invoke the name of Hitler they are losing the argument. Perhaps that's one reason why the betting markets point so strongly towards the United Kingdom voting to stay in the European Union.
And there must be other less apparent ones to explain why the Betfair price about staying in Europe is $1.42 with leaving being $3.30 for the opinion polls have things much closer as this poll-of-polls chart from The Economist shows:


Despite weeks of near level pegging in the polls, the market at Betfair on a vote to stay in has hardly changed.

Today's London Sunday Telegraph Hitler reference notwithstanding, that doesn't seem right to me and I hope my investing $50 on a leaving vote is not just because I am looking forward to Boris Johnson throwing the Conservatives into chaos by challenging for the Prime Ministership after a successful crusade for the UK to once again be the saviour of Europe.