Making Votes Count
I’ve been betting on elections since 2006 when Bodog (now Bovada) but up some lines under the ‘Entertainment’ section of their site. 2006 was not a Presidental election but there are Senate seats up every two years along with everyone in the House of Representatives. There was a maximum payout of $50 for each race they had listed and if memory serves they had nearly all 33 of the current Senate races listed. Even though they are statewide, not all Senate races are competitive. This year it was roughly half with that number diminished even further to around 10 or 11 by Election Day. 2006 was similar.
Bodog’s mistake was putting up lines for all of the races instead of the competitive ones. One of the enjoyable parts of betting on politics is the relative degree of certainty that exists for certain races. I’ll expound on this below, but if there are multiple polls that all show a single candidate 7 points ahead on Election Day, he or she is going to win at least 99 times out of 100. I don’t think I’ve ever seen or heard of someone losing after late polls showed them ahead by 10 points or more.
Keeping that in mind, Bodog had these lines up with the highest being -800 or so. At -550 was Indiana where Richard ‘Dick’ Lugar was running for re-election. When I searched for his opponent however I couldn’t find one. He was running unopposed which meant that I could loan Bodog $275 and get $50 back a couple of months later. There were others with living breathing opponents who had about as much of a chance of losing as Lugar did, all of whom required a loan of various amounts to be paid back on Election Day. Bodog eventually wised up and moved the lines to a more respectable -5000 or higher meaning Back in the days of Neteller, it was easy to get money moved around to take advantage of these sorts of opportunities, but this ended a few years back. It’s also hard to bank on books as incompetent as Bodog, especially when they make it exceedingly difficult to get money out.
Thankfully Intrade has come along and has enough volume to get much more than a $50 payout on things other than just the Presidential race. In 2008 I had a solid four figure payout on now-President Obama to become both the nominee and win the Presidency, though it required having money locked up for the better part of a year. In earlier action this year, I lost on Rick Perry becoming the Republican nominee but made most of that back betting against Newt Gingrich to become anything. This will make sense as I walk through my open bets below, but I’m only really interested in either long or long-ish shots that could hit or staking lots and lots of money down for a relatively small return on sure or nearly sure things. I really don’t have much interest actually gambling on Team R or Team D. A lot of people feel differently which probably explains some of the pricing
For research on this stuff, I don’t do much more than follow electoral-vote.com and Nate Silver’s 538. Silver is an ex-Baseball Prospectus writer and has become more mainstream since he got picked up to blog for the NYTimes. He does a little more advanced predicting and modeling, but the base poll numbers both sites use are about the same. It’s helpful to know when there’s a major news story, but I don’t trust my ability to take action before the market.
One note about Intrade is that it works nearly identically to Matchbook, the non-Pinnacle awesome sportsbook that I can’t use as an American. For any bet/trade made there has to be a real live person taking the other side of it, so you can post your own lines and see them matched (or not). A good chunk of my action I just put out a price that seemed far enough from the “true” odds and it magically got picked up The picks themselves are not likely to change between now and Tuesday but the amounts may fluctuate as I balance things a little more and/or pick up some more shares. Another great thing about the liquidity is the option that will exist to close out some of these at a loss at any point on Tuesday should they go wrong. The risk & loss can be limited by half or more just by paying attention. I’m perfectly willing to take a small loss instead of a big one and it’s something that doesn’t exist with a traditional book.
I’ll start with the President and finish with weed. Forward…
Obama Re-elected -177
I’m converting these to Moneylines to make it easier to follow. Intrade uses a percentage system where each share is worth $10. My average price on Obama is $6.39 so I’m risking that much to win $3.61 times the number of shares I have. I’d rather not get specific with dollar amounts but I will be commenting on exposure and risk as I’m very, very heavy on some of the bets below. I’ve been steadily increasing my Obama numbers in the last few days as the polling numbers have been trending his way for a few weeks now, but definitely since the hurricane a week ago.
I don’t have the numbers handy, but Intrade has Obama’s price much lower than any other books or prediction markets and that’s been the case all season. Very generally, Romney’s chances are much higher on sites that allow Americans to bet versus those that don’t. Romney in reality probably has around a 15-20% chance to win but I would be very surprised if his numbers dipped that low on Intrade before Tuesday night.
Republican Nominee Over 200 Electoral Votes -300
270towin allows you to color in your own electoral map (Fun for the whole family!). If you click on ‘Battleground States’ Romney starts with 191 and Obama with 201. These are states that are 100% in either candidates column essentially before the election begins. These are the states where it’s difficult to determine whether or not there is a Presidential election going on. This is essentially a bet that Romney will win at least one of Virginia, Florida or North Carolina, three states he’s currently winning today. I couldn’t get any money down on +190 so this will have to do. Small bet here
Republican Nominee Under 330 Electoral Votes -793
Romney’s maximum is 337 which includes Michigan and Pennsylvania which are 95%+ likely to end up Obama. If Romney does win it won’t be by this much.
Democrat Nominee Over 230 Electoral Votes -408
This is a fantastic price for something very, very likely to occur. As above, this wins with Michigan and Pennsylvania.
Mitt Romney to Win the Popular Vote by 2% or More -207
The national tracking polls as of Saturday range from Obama +3 to Romney +1 with an average of +1.2% Obama. All of these popular vote percentages were only put up this week by Intrade and I haven’t checked closely, but I probably have half of the total action on the Romney side on some of these. Not this one as it’s unlikely but still in the realm of possibility.
Romney 3% or More -303
Increasing the number of shares here. It’s close to impossible for this to occur and Romney to not become President. It’s also important to note that the national polls have barely budged since Romney became the nominee with Romney +3% being the peak. It’s very, very possible for Romney to win the election, and the popular vote without covering the 2% above, much less the 3.
Romney 4% or More -456
Now we are getting into silly territory. This is a perfect example of something I posted that got picked up, so I re-posted at a slightly worse price and that got picked up as well. Rinse, repeat. I now have way more of this than I ever expected and we’re approaching free money territory here. FWIW, these are almost equally dumb on the Obama side, but he’s at least marginally winning.
Romney 5% or More -465
I own roughly 3/4 of the active shares on this. If this even comes close to hitting, my losses will only be contained by how quickly I can sell everything else off. Think stock markets crashing and then promptly being set on fire.
Romney 6% or More -590
There is no rational thought that supports this happening.
All Republican Government (President, House Senate) -400
I am betting against this. There has been a lot of action on this as the price has barely budged despite Romney’s odds decreasing. As mentioned above, Romney is at least a +300 to +400 underdog and according to the Offical Loubacca Senate Tracker, the R’s would also need to win two of the three coinflip to slightly D-leaning Senate races. This is strongly correlated with Romney winning.
Presidental Winner Also Win Popular Vote -300
I am trusting the 538 numbers here that have the odds of this at 6.8%. Small bet & action and reminds me of a favorite Super Bowl prop – Will there be a Safety scored by either team? – No only with a much better price. If the price dropped down to 10% or so I would happily take the other side as I think the odds are understating the chances of this happening slightly. Most likely, Obama wins by 1% or less.
I’ve also got a couple of hedges in place to help mitigate any losses, especially with some of the Senate bets below. They are as follows:
Senate Tie (49-49) +890
Senate Tie (Sanders VT as Democrat) +4662
I’ve summarized the wording from how Intrade has it, but basically there are different rules for different Senate bets. For some Bernie Sanders in Vermont, who is an Independent, counts as a Democrat. For the others, he counts as an Independent and not an R or a D. There is another Independent in Maine who is also going to win his race.
Counting open races that are locks, the current composition of the Senate is as follows:
Here are the leaners with their approximate chances of winning:
The +890 would hit if two of Indiana/Wisconsin/Virginia went R. If three flip to R, the +4662 comes into play and with it the opportunity to cash in some winnings. If these come open however, it probably means the R’s in general and Romney are having a better than expected evening which will cause problems elsewhere. Most of these are east or midwest states so it will become obvious early on if either is in play.
Bill Nelson to Win -679
Connie Mack to Lose -478
Another fun Intrade fact is that there are two bets on every race because you can bet on either candidate to win or lose. I have been loading up here as Mack has not led in a single poll since July and the latest ones have Nelson seven or so points ahead. Again I don’t want to get too specific, but if Nelson loses this I will be hurting come Wednesday. The Nelson win bets only came in after I couldn’t get my price matched on Mack anymore. Another fun fact here is that Connie is a guy and his full name is Connie McGillicuddy. I only found this out a few days ago, as as much as it pains me to bet against anyone named after alcohol I have to do it.
Warren to win -350
If you track the states where Senators are running effectively unopposed, they tend to come from the states that are very heavily comprised of voters who are R or D. Candidates start as a member of either party and there is a base of people in each state that will vote for anyone who is either Team R or Team D. In Massachusetts, that gap is roughly 7 points towards team D. This means any R candidate is essentially starting with a 3.5 point gap. Strong candidates can overcome this type of disadvantage. Scott Brown is not a strong candidate, having only won office when Ted Kennedy died and Martha Coakley and her campaign staff were so arrogant they didn’t run a poll until a week before the election and only then found out they were losing. There was good money to be made this summer when the polls were all weighted toward Brown and Warren was around a +300 underdog. It would have been a good bet based on the state D/R gap alone.
Mourdock beat our friend Dick Lugar in a primary this spring. Lugar then “retired” and Mourdock, a Christianist who answered a question in a debate about abortion/rape/pregnancy in a particularly poor way, has gone from a favorite to an underdog by offending women everywhere on live TV. There might be enough Christians & Republians in Indiana for him to win anyway but it’s not looking good. I picked up a few shares after the debate debacle but before the polls that showed him well behind.
A Google search for McCaskill’s opponent Todd Akin comes up with the following:
“Todd Akin compares Claire McCaskill to a dog”
“Todd Akin ‘legitimate rape’ and pregnancy controversy.”
I don’t like his chances.
Sherrod Brown -400
Sherrod Brown is another favorite from Bodog 2006. He’s been polling over 50% and people keep betting on the Republican guy who is 5-7 points behind. There is an extremely R leaning polling firm that likes Brown’s opponent so that may be why I am still getting matched on or around -400.
Rhode Island Senate
Whitehouse to win -2028
This is really stretching the free money argument as I’m betting over $200 to win 12 dollars. I had a hard time finding the opponent here. This is the biggest favorite I’m betting though there are a few that are close below.
Tim Kaine to win -147
An exception to not betting close races. Small bet here that is properly hedged with the Senate stuff above if this fails.
I also have some Presidental State bets that have become popular on Intrade. I got a lot of this money down earlier before I started loading up on Obama. These are exceedingly likely to hit regardless of whether Obama wins or not. I really did not intend on these all being Obama to win X state, but I couldn’t get any action on the Romney state equivalents.
Obama to win Connecticut -1438
Your free money game of the week.
Obama to win Illinois -1900
I couldn’t help myself when I saw someone had a ‘Romney to win Illinois’ bet up, even if it’s only for 50 cents.
Obama to win New Mexico -1063
Not a lot of action here either, but I like free money. These three bets plus Whitehouse/RI will cover the Senate hedging money.
Obama to win Michigan -550
Real money bets start here. This bet and the three below it are all states that Obama should win by 5-7 points. Romney screwed up by not pushing this sooner and giving himself Ohio alternatives. (For those of you not politically informed, Romney has close to zero realistic scenarios to win without Ohio.) I got a little spooked having this much money down after there were some polls that showed Michigan being close, but Romney hasn’t “led” since a single poll in July.
Obama to win Minnesota -750
Same story here only Romney has never led. Obama will win here by 7-8 points. Someone keeps tempting me to dump more money in here even though I have a lot of exposure already as prices for Romney to win in the area of +700 to +800 keep appearing. There’s another batch of 100 shares at -740 as I write this. I’m likely to seek out a better return and continue to load up on Obama below -200 rather than the far more marginal return here. If Obama were to lose Minnesota he certainly would not be President for much longer.
Obama to win Pennsylvania -424
A single polling group has shown Romney tied or leading in their monthly polls, but everyone else has disagreed only on the margin of Obama’s lead. Romney is dumping money and time here as an Ohio alternative. This is the political equivalent of a Hail Mary, only the throw is to tie not win. That said, Obama is only ahead 3-6 points here instead of the 5-7 that would make this a lock. If this is more than a slight sweat, Romney is likely doing well and I’ll be looking to take a slight loss on this one and move on.
Obama to win Wisconsin -300
Similar to Pennsylvania, Romney has never led here but he has been tied a lot, though not in the last week or so. This would be a clear pass weeks or months out, but with only a few days to go, a 3-5 point lead is solid if unspectacular. Wisconsin is only worth 10 electoral votes compared to Ohio’s 19 and Pennsylvania’s 20, so this won’t help if Romney loses the other two. Less exposure here than the other states and I don’t want any more either.
Lastly, Intrade has ballot initiatives up for Oregon, Colorado and Washington, all of which involve marijuana legalization. Washington and Colorado are favored to pass with Washington being a clear favorite. Oregon is likely to fail with the guy who funded the initiative only having enough money to get it on the ballot. They couldn’t even afford a billboard until last week, so I have one share of this to fail at 2.11. Semi-related, someone has 420 shares to pass at one cent each. I feel like I’m betting against my own team here. I’ll win money but won’t be happy about it.
That’s it for now. Good luck this week.