Wednesday, 9 November 2011

Election Betting - The Latest

A month ago, the various betting agencies making a market on the next Federal election in Australia were offering around $4.00 for a Labor win and around $1.23 for a Coalition win. Polls at the time generally had Labor's two party preferred vote around 42 or 43 with the Coalition around 58 or 57. Those commentators suggesting that Labor had no chance would presumably have been happy with the $1.23 (a 23% tax free return for a 2 year investment) although there is no way of knowing whether there was any significant money on the Coalition at those odds.

In the last few weeks, as the Labor two party preferred vote has come back to 46 or 47 and the Coalition vote has shrunk to 54 or 53, Labor have come into around $3.50, while the Coalition has widened out to around $1.30.

I say the odds are "around" those levels for as far I can tell, there are 6 agencies betting on the election - Centrebet, Sportsbet, Sportingbet, Betstar, Tom Waterhouse and Betchoice. [Please let me know if you find any more.]

As things stand, Betstar and Tom Waterhouse are offering the best odds on a Coalition win at $1.35, while Sportingbet has Labor at $3.75.

The election is just under two years away. Polls will swing, a few dollars will be invested and inevitably, these odds will also swing around. I wouldn't be at all surprised if at some stage over the next two years, the Coalition's odds will widen, meaning that clever punting can lock in a guaranteed profit. As it is, betting on Labor with Sportingbet and taking the Coalition with Betstar or Tom Waterhouse can lock in a tiny profit (not worth it now given the cost of carry - interest in other words).

But plonking a few dollars on Labor now at $3.75 and then jumping on the Coalition when they blow out past $1.50 (hopefully you can get even better odds at some stage), you can guarantee a nice profit, which ever party wins the 2013 election.

I will create a paper election betting portfolio that I will update hopefully to show my logic:

First bet:

$100 on Labor at $3.75.

Stay tuned.
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3 comments:

  1. Phillip Metaxas10 November 2011 at 01:50

    Guaranteed profit? Pfft.

    What about Bob Katter's Australia Party?

    ReplyDelete
  2. D Mick Weir10 November 2011 at 06:22

    Yer crazy and I like yer style.

    I am guessing that you aren't 'plonking' any money on a Dec 2011 election given that (as far as I can figure) the only possible dates left are Sat 24th or Sat 31st Dec which even non believers would have difficulty accepting.

    So what are your thoughts on the markets for timing of the poll?

    ReplyDelete
  3. D Mick Weir10 November 2011 at 06:54

    Hmm, I have done some back of the envelope tinkering with your current stake and the counter bet on the Libs.

    You need the their price to come out to $1.88 so you can outlay $200 for a return of $375.00 no matter who wins. That way you have a 'profit' of $75.00.

    Accepting that it will be at least 18 months until we know the result, $75 'interest' on $300 'invested' is about 16.5% pa. Sort of looks ok.

    Reckon though you could get a $75 'profit' sooner by backing Black Caviar at her next start.

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