How the punters beat the pollsters
January 28th, 2005
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Are betting markets a good guide to changing opinion?
A remarkable aspect of today’s YouGov move to the Tories was that the change was forecast more than forty-hours beforehand on the betting markets even while the survey for the Daily Telegraph was still taking place.
On Tuesday Michael Howard’s party was at it’s lowest point for years on the spread-betting markets with the range being predicted by those ready to back up their opinions with cash at 183-190 seats. The following day we reported that the price had gone up two and suggested that the Tories might have bottomed and then, perhaps, was the time to buy.
Since then the YouGov poll has come out and the Tories are showing a six seat gain in four days. The latest IG Index spreads are Lab 355 - 362: Con 189 - 196: Lib 70 - 74
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It is important to note that what prompted the move mid-week was not a new poll or a comment on Politicalbetting - but punters taking stock of the situation and putting money on.
It will be interesting to see if today’s poll trend is picked up by the Communcate Research survey due to the published in the Independent on Sunday and the February Populus survey which will probably be in the Times a week on Tuesday.
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For our General Election Coverage we are hoping to feature a live feed of betting prices so that users will be able to get the latest information on how things are moving.
As we get closer to the day the amount of money being bet will increase dramatically and prices could be changing many times a day. The live information could become a vital information source and it will be interesting to see if the gamblers beat the pollsters and the pundits.
Mike Smithson
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The CR poll will likely inflate the Labour lead somewhat (as per previous evidence), I wonder if this will detract from the Tory ‘momentum’ especially if the Populus poll is equally disappointing? However if the YouGov evidence is equally proven then could the malaise amongst Labour voters be broken pronto with an illustrative swing Lib-Lab in the March polls? Its always a worry for stategists when postive polling evidence peaks to soon enabling Labour to break from a kind of torpor; is this relative boost for the Tories the worst thing that could happen in the electoral cycle or does it prove that Lynton Crosby really does deserve his huge paycheck?
Incidentally my feeling is the major spread betting houses are all short the LDs. They seem to be holding up very very well somewhat against my expectation. I also think that many natural Tories have concluded rightly or wrongly their party is going to lose and even may be finished, and see the LDs rightly or wrongly as the beneficiary.
Jon - I think that what’s happening is that if sentiment is running against Labour and there’s no support for the Tories then the LDs are the only place to go. It’s probably more the market makers than punters who are keeping the LD spread so high. Their objective, of course, is to ensure that nobody wins.
In October I cashed in my LD spread bet at 72 seats after buying at 58 and 60 and I’m not yet tempted to go back in.
winces monarch submits!receives:unextended enthusiast abutting