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Betting markets currently give Trump a 10% chance of winning this election. On election night, most betting markets had Trump a severe favorite (75-80% in many

by birken 6y ago

Betting markets currently give Trump a 10% chance of winning this election. On election night, most betting markets had Trump a severe favorite (75-80% in many places), which in retrospect seems severely mis-calibrated. This year betting markets were swamped, and continue to be swamped, by money supporting Trump. This year happened to also have a polling error that underestimated Trump's chances. Those two facts aligned together to form a situation where the betting markets seemed to better predict the election results than polls. However, based on one very strange election I wouldn't extrapolate out that betting markets are always better than polls.

zwily 6y ago
Betting markets have various limits that protect them from being gambling sites, and you literally cannot buy any more contracts on Biden on the ones that show a 10% chance for Trump. That keeps the odds from moving. If the market was liquid, that 10% would surely fall. Disclaimer: this was explained to me by someone that plays the betting markets, and it could all be wrong.
- birken 6y ago
  That quirk is true on PredictIt, but currently on Betfair there is a very liquid market with millions of dollars on both sides where the implied odds are roughly 95% for Biden and 5% for Trump. Now, betting markets do have the problem where even if the bet was a "sure thing", it might not be worth betting for a ~5% gain when you account for the risk and effort related to getting the money into and out of the betting market, and I think that partially explains why the market has settled where it is. But still, this highly liquid market had Trump a pretty strong favorite on election night as well.
- ISL 6y ago
  I am aware of caps on the amount of money an individual can risk in prediction markets, but not a cap on the total number of positions. Where might one find such a market that presently shows a 10% Trump chance? It would be interesting to see what the trading volume looks like.
  - croddin 6y ago
    Here is one: https://www.predictit.org/markets/detail/3698 https://www.predictit.org/markets/detail/3698
    - sushid 6y ago
      Yes but you can't purchase that contract. PredictIt is not a free market betting platform with a bunch of restrictions (e.g. $850 limit per contract per person, 5000 bettor limit per contract, 10% vig on winnings, 5% vig on all cash withdrawn). That being said, I've told friends to make free 5% after all those fees (before tax) and a bunch have made some beer money by betting on PA and a few other states.
- giaset 6y ago
  This isn't true. There are some very liquid markets that still have Biden at ~85% Can easily get 5-6 figures down on Polymarket (been adding to my position all week) https://polymarket.com/market/will-donald-trump-be-inaugurated-for-his-second-term-as-president-of-the-usa-on-inauguration-day-january-20th-2021 https://polymarket.com/market/will-donald-trump-be-inaugurat...

by birken 6y ago

zwily 6y ago

Betting markets have various limits that protect them from being gambling sites, and you literally cannot buy any more contracts on Biden on the ones that show a 10% chance for Trump. That keeps the odds from moving. If the market was liquid, that 10% would surely fall. Disclaimer: this was explained to me by someone that plays the betting markets, and it could all be wrong.

birken 6y ago
That quirk is true on PredictIt, but currently on Betfair there is a very liquid market with millions of dollars on both sides where the implied odds are roughly 95% for Biden and 5% for Trump. Now, betting markets do have the problem where even if the bet was a "sure thing", it might not be worth betting for a ~5% gain when you account for the risk and effort related to getting the money into and out of the betting market, and I think that partially explains why the market has settled where it is. But still, this highly liquid market had Trump a pretty strong favorite on election night as well.
ISL 6y ago
I am aware of caps on the amount of money an individual can risk in prediction markets, but not a cap on the total number of positions. Where might one find such a market that presently shows a 10% Trump chance? It would be interesting to see what the trading volume looks like.
- croddin 6y ago
  Here is one: https://www.predictit.org/markets/detail/3698 https://www.predictit.org/markets/detail/3698
  - sushid 6y ago
    Yes but you can't purchase that contract. PredictIt is not a free market betting platform with a bunch of restrictions (e.g. $850 limit per contract per person, 5000 bettor limit per contract, 10% vig on winnings, 5% vig on all cash withdrawn). That being said, I've told friends to make free 5% after all those fees (before tax) and a bunch have made some beer money by betting on PA and a few other states.
giaset 6y ago
This isn't true. There are some very liquid markets that still have Biden at ~85% Can easily get 5-6 figures down on Polymarket (been adding to my position all week) https://polymarket.com/market/will-donald-trump-be-inaugurated-for-his-second-term-as-president-of-the-usa-on-inauguration-day-january-20th-2021 https://polymarket.com/market/will-donald-trump-be-inaugurat...