politicalbetting.com

Is the Chancellor really a 73.5% certainty?

With the long awaited Turner Report on pension due to be published today and the attention focusing again on the Chancellor the PBC index puts his chances of taking over Tony Blair at 73.5%. Our chart shows the the implied probability of him getting the job and is based on best betting prices. The only decision, for the Labour party, it is said, is whether he goes through unopposed or whether there is a contest. For however you view the contest it is hard to see how anybody else could come through.

Yet for the third time in two years I have become convinced that a heavy odds-on favourite to be his party’s standard-bearer might not make it - and there’s betting value at current price levels.

Two years ago the ex-Governor of Vermont, Howard Dean, looked all set to win the Democratic nomination. By the start of December 2003 he was trading at about 0.6/1 and poll after poll reinforced his favourite status. Yet there was something in his character that provoked doubts in me and I started to lay (bet against) heavily. I could not see how his sharp temper and aggressive style would go down well - and indeed it didn’t.

Then, this summer, came David Davis. Although the early polls and the betting pointed to his near certain victory in the Tory leadership race I was not convinced that someone who had such poor public speaking skills could make it. At the time I could not decide who would do it so again I began laying him heavily at the odds-one prices.

Now I feel the same way about Gordon Brown. Sure - the polls rate him higher than Blair but is that simply because he is not Blair? How will he be if ever the electorate assess him on his own. The great thing about a leadership race is that it puts a candidate’s style and personality under the most intense scrutiny and in the Democrat and Tory races it became apparent that the favourites were not right.

Come Labour leadership election time there might be a realisation that Brown’s hallmark of reeling off lists of bullet points at a rapid rate is not the right way to engage voters.

I was very struck by this comment on the site by Alex a few days ago. “I still think the real issue is the extent to which Gordon Brown could implode. He has always had a bit of potential to get attached to politically disastrous/divisive policies, but freed of the restraining hand of Blair there maybe nobody to let his stubbornness overrule other people’s heads. People have focused on the extent to which strategically there may be little change once Brown replaces Blair but the way policies are sold (tactics) could change massively for the worse. The latest claims over pensions are not a good sign.”

So with some of my anticipated winnings from David Davis’s failure I’m having a punt that Gordon will not be the next Labour leader. You can lay him at 0.36/1 - so a lay of £100 would cost me £36 if he does it and give me the £100 if he does not.

Mike Smithson

Who is the mystery Windsor punter?

With the Cameron-Davis race looking even more of a certainty one punter has staked what is believed to be the biggest political bet ever placed - £200,000 - in a William Hill betting shop in Windsor.

The man, in his forties and with an Irish accent, walked into the William Hill shop, and asked staff what odds Cameron was to win the race to be become Tory Leader.’When they explained that he was a red-hot 1/25 favourite, the man said he wanted to place £200,000 on Cameron winning’ said a Hill’s spokesman.

He went on: “The staff had to refer the bet to Head Office for acceptance, which was duly agreed and the man, who they had seen in the shop once or twice before, but who had never previously staked more than £100 on any one bet, paid on Monday morning by banker’s draft. He stands to win a profit of £8000 if the bet is successful. There is no record of any bookmaker ever accepting a political bet of this size before.”

And if you are speculating about the identity of the punters the spokesman went on: “.. although it could be described as a right royal wager, the location of the betting shop, in the shadow of Windsor Castle is not significant in terms of the identity of the customer, who has asked to remain anonymous”

After taking the bet, Hills slashed Cameron’s odds even further to 1/66, with David Davis now a 14/1 chance. The previous biggest bet Hills had taken for Cameron was £39,200.

Even though David Davis is having to to go through the motions of claiming that he still has a chance it is hard to see any other outcome. The only risk, surely, in this bet if if something tragic happened to David Cameron. While it’s still possible to get a return then we will see more bets like this one - and at tighter prices.

The current best price is 0.03/1

Mike Smithson

Only nine days to go before the pay-out

Whatever your personal view of the Tories or David Cameron we hope that all those who have been tempted to bet will have had a profitable leadership election. The changing implied probabilities Cameron based on best betting odds are illustrated in our chart. From a best price of 10/1 his price has tightened even further overnight to 0.03/1.

After going strongly for him on July 3rd and then on August 1st I lost my nerve in the week before the Tory conference in Blackpool and on September 29th switched to Ken Clarke. This proved very costly because it meant closing down a spread on Cameron at the 10 level - which was 14 less than I had bought him at. The following week, after being impressed by his campaign launch, it was back into Cameron again - this time at the 9 level.

The mythology has developed that Cameron’s success is all down to one speech. But Davis was still a strong odds-on favourite when he walked onto the Blackpool stage. To my mind, and this can be seen in market reactions, the biggest boost Cameron got was the Frank Luntz “focus group” on Newsnight at the start of the conference which set the scene for the big speech.

There was a loss of nerve again a week after the conference when all the talk was of some sensational revelations in the Sunday papers on Cameron. The day before the spread bet was closed down at 49 - a nice profit - but would have been a 100 times my stake level on December 6th.

By November 1st the only real issue was the size of Cameron’s victory. Although the Tory member polls were pointing to a 76:24 margin I went for the 3-1 that was then available on Cameron getting less than 66%. This bet had the beauty of providing some cover if, by any chance, Davis managed to do it.

There’s also been the minor market of how old the winner will be when the sell spread level was 49 and the only options were 39 and 56 years old. On top of all this betting I made a fair bit going into Ken Clarke immediately after the French referendum in May and then coming out a few days later after reading the negative comments from PB.C’s Tory community.

Looking back at my Betfair account my most profitable punts were not on Cameron at all. I began laying (betting against) David Davis heavily from June onwards when he was odds on because I simply could not see him as party leader.

So a nice profit awaits on December 6th - one that will be even bigger if Cameron comes in below 66%. But it would have been a lot more if I had kept my nerve.

Mike Smithson

YouGov and pensions row fail to dampen markets

Punters on the “which party will win most General Election seats” markets are taking a slightly more optimistic view of Labour’s chances in spite of the YouGov poll showing a 6% drop in the party’s lead and the ongoing row over pensions policy.

PB.C’s weekly index is based on the best betting odds available on Labour and is presented in terms of implied probability of it securing most seats at the next election. This morning it stands at 58.5%.

The findings of Friday’s YouGov poll in the Telegraph which had a majority of those surveyed saying that the Tories General Election chances have improved do not seem to have impressed the punters who are prepared to put money into this long-term market.

It should be noted that the betting is on which party will secure most seats - not on whether Labour will get a majority. Given that many experts reckon that the Tories need to be several points ahead on votes just to be level on seats it is, perhaps, surprising that the index is so low.

Mike Smithson

Markets opens on the Lib Dem leadership

It’s a sign, surely, of the position that the Lib Dems now have in British politics that a bookmaker considers them important enough to open a market on whether their leader will survive. The price is 1/3 that Charles Kennedy will still be in post at the General Election and 9/4 that he won’t.

Given that we might be four years off a General Election there is no point in locking up your cash for so long for such a modest return on him staying. But what about the 9/4 on him going?

Whenever his leadership has come under scrutiny by his fellow Lib Dem MPs Kennedy has managed to play the Simon Hughes card. This was brilliantly described by in the Times by Matthew Parris. “.. Simon Hughes, the ageing young pup who for a decade has seen himself as the natural “elsewhere” heir to the leadership, is more admired by Lib Dem activists than by their MPs. Charles Kennedy knows this. He adopts the flip side of the resort of fugitives who hold in front of them a captive child: “Shoot and the baby gets it.” Kennedy holds Hughes behind: “Shoot and you’ll get the baby as your leader.” It always works.”

The big short to medium term danger for Kennedy is if David Cameron enjoys a prolonged media honeymoon. The liberal, with a small L, social agenda that DC appears to be following together with a much softer Tory line on environmental issues might start to eat into Lib Dem territory.

If the party’s poll share starts to decline and May’s local elections are disappointing then we might see a move - but we doubt it. The Lib Dems have not got the ruthlessness of the Tories when it comes to getting rid of leaders.

Either way we do not see this as a bet worth making.

I thought that 1/3 on Kennedy still being there on New Year’s Eve seemed a great bet. If it had not been for a problem with my credit card details I would have put £900 on in the expectation of making £300 in six weeks. Blue Square should take immediate action to clarify the terms of the market on the betting slips and in the information going to the betting search engines.

Mike Smithson

1 in 13 Labour supporters switch to the Tories

The November YouGov poll in the Daily Telegraph reports a big cut in Labour’s lead and is the first significant polling movement since the Tories started to get a lot of media attention from their leadership contest.

Until today the Cameron-Davis fight had not appeared to have had an impact on the General Election voting intention of the main pollsters. All eyes will now be on ICM, Populus and Mori to see if they are picking up the same trends.

Today’s YouGov shares with the changes on last month are CON 35 (+3): LAB 37 (-3): LD 20 (+1).

Given that the Lib Dems have also shown an increase it look as though there has been a move of three points from Labour to the Tories. This is a big change because recent experience is that reductions in Labour’s margin have been attributable to rises in the Lib Dem share - not to Lab-Con switching.

Such volatility in a single month is very unusual for YouGov which, with its large sample sizes and internet methodology, has a history of recording relatively small jumps. Until today the pollster had had the Tories in a range of 31-33% since the General Election.

For the Lib Dems there will be some relief that in spite of all the attention on the Tories they have managed a small increase.

The poll has some other good news for the Tories - more than half those questioned thought that the party’s chances of winning the next General Election were getting better. On Labour those surveyed split 72-10 on the proposition that the overall standing of Labour was getting worse.

This poll is what many have been expecting given the huge focus there has been on the Davis-Cameron fight. The big question is whether this change will be sustained. I think we are going to have to wait several months before we can draw firm conclusions.

Charles Kennedy betting. We have temporaily withdrawn our story on the new “Will Charles Kennedy go” betting market because there is some ambivalence on the time scale and the precise terms of the bet. Thanks to Guido for pointing this out.

Mike Smithson