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Screenshot of a breaking news alert e-mail from Q2 2017
With now less than three weeks to go, we thought that we would take a quick look at what UK oddsmakers and bookmakers are saying the ‘real’ odds are right now of either Hillary Clinton or Donald Trump winning the US Presidential election on November 8.
Unlike polls, oddsmakers’ numbers aren’t estimates or polled people saying whom they would vote for. Polls are often biased by who is taking the poll, whom is polled, how many people are polled, when the poll is taken, how the questions are asked…. resulting often in a variety of hugely different poll results. Polls are often viewed by objective voters nowadays are marketing fodder, put out by biased individuals or organizations.
However oddsmakers’ odds are based on real bets made by anyone who wants to put real money on the outcome of the election.
As more bets come in for a particular candidate to win, the cost of betting for that candidate to win go up. Just like bets on a sporting event – if everyone bets for a particular team to win, the betting odds will move very quickly in that candidate’s direction. And like all open markets, there is a self-correction mechanism present. If too many Hillary supporters bet on Hillary (or Trump supporters on Trump), moving the odds in her/his direction, there surely are ‘objective’ people out there who will want to capitalize on the opportunity by betting in the other direction.
So what are the oddsmakers numbers saying?
UK oddsmaker figures are clearly predicting a Hillary victory, with bets showing an 80-82% chance of another Clinton taking hold of the White House. And, voting with their wallets, some bookmakers are actually making payouts to the early Clinton bettors, calling her victory on November 8 a ‘done deal’.
UK spread betting giant Paddy Power posted on its blog that it is paying out more than $1 million right now to those who bet on Clinton. Paddy Power gave some props to The Donald, but ultimately concluded:
Trump gave it a hell of a shot going from a rank outsider to the Republican candidate but the recent flood of revelations have halted his momentum and his chances now look as patchy as his tan. Recent betting trends have shown one way traffic for Hillary and punters seemed to have called it 100 per cent correct. Despite Trump’s Make America Great Again message appealing to many disillusioned voters, it looks as though America are going to put a woman in the White House.
There is no legal or contractual reason for bookmakers to pay out bets early, before the fact, like Paddy Power is. However in situations like this they sometimes will, to generate goodwill among their clients and as a marketing and PR tactic.
As of this morning, the political binary market at IG Group Holdings plc (LON:IGG) is showing an 80.5% chance of Hillary winning, who is getting roughly 6:1 odds of winning. If you want to win $1 if Hillary triumphs in the election, it will cost you $6.
And conversely, Trump is running at just a 19% chance of becoming the 45th President. If you bet $1 that Trump will win – and you turn out to be right – you’ll win $5.
Interestingly, there are some bets still coming in on ‘other’. Although they’re getting minuscule odds, Paul Ryan and Mike Pence are actually receiving some bets on becoming #45.
While these are fairly powerful figures, we would remind LeapRate readers that bookmakers’ bets-derived odds got it wrong in the last major political binary vote – Brexit. Down to the very day of the vote, UK voters’ bets were predicting an 80%+ chance of a Remain victory. And in the end, it wasn’t even close with #VoteLeave taking it 52-48. For more on that read: The reasons why UK bookmakers got it wrong on Brexit.