Archive for May, 2004

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Will YouGov repeat its Scotish success in London?

Thursday, May 20th, 2004

london
The conventional opinion polls got the London Mayoral Election so badly wrong in 2000 over-estimating Livingstone’s support that it’s no wonder that they’ve mostly avoided this June’s battle.

There were six main polls in 2000 which showed leads over Steve Norris ranging from 34%-57% when on the day the margin was just 11.9%. The smallest error was a staggering 22%. Apart from one ICM survey reported in February the polling this time has been left to the internet pollster, YouGov.

    Will YouGov’s unique methodology, so criticised by the other polling firms, make a better job? For if it does it could have far-reaching implications.

A close prediction of the London Mayoral Election will be a good pointer to the accuracy of YouGov’s General Election polls which have consistently shown higher shares for the Conservatives than the other opinion polls.

Following its accurate 2001 General Election forecast YouGov’s best performance was at last May’s elections for the Scottish Parliament. Then they got Labour, the Conservatives and the SNP to within one per cent. The only failure was with the Lib Dem vote which YouGov predicted at 19% against an actual 16%.

    The big YouGov success was predicting the Conservative vote in Scotland. All the other polls had the party at either 11 or 12%. YouGov put them at 16% against an actual 17%. With Labour the other polls over-estimated the share by 4-8%. YouGov’s overestimation was 1%.

Getting an accurate Tory share has been a nightmare for many pollsters for many years. This has been put down to Tories being less reluctant to admit their allegiance to a compter as with YouGov, rather than to an opinion poll interviewer as with the conventional polls.

Will YouGov be able to repeat this in London on June 10? A challenging issue for all pollsters is the turnout – in Scotland last year it was 49.5%. At the London Mayoral Election in 2000 it was just 34% and the signs are that it could be lower this time. The conventional wisdom is that the lower the turnout the better it is for the Tories.

Political gamblers seem to be ignoring YouGov’s latest London poll that had a Livingstone lead of just 5% amongst those “certain to vote”. With such a gap in a normal election market you would expect prices of 1.5 for the leader and 2.5 for the challenger especially as the margin has been narrowing with every poll. Here even the betting exchanges still have Ken at 1.22 and Norris at 6.

UPDATE – WHITE HOUSE 2004.Prices are edging towards Kerry. On the Iowa Electronic Exchange, which we have explained before, Kerry is within a hair-breadth of Bush. The prices are rated out of 1 and Keery is on 0.49. On the UK markets Bush is still a clear favourite but the gap is tightening.



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Avoiding my biggest politcal betting disaster

Wednesday, May 19th, 2004

broke

    A new tool to help predict the next House of Commons

My biggest ever political gambling loss was on the 2001 General Election because I had not thought through the issue of relating votes to seats – the critical factor in UK General Elections. I bought the Conservatives in the spread betting Commons seat markets because I believed that the opinion polls were wildly overstating the Labour lead and that the election would be much closer than was being predicted.

    I was completely right. Instead of the 25-30% leads that the pollsters were recording Labour’s eventual lead was 9% down 4% on the landslide victory of 1997. But all the accumulation of votes in their own areas did was to notch up the overall voting figures without producing what really mattered to them (and my bet!) – more MPs. They were also hit by strong tactical voting.

There were two lessons:- The Westminster seat distribution is totally skewed to Labour: Spread betting can be very expensive!

The biggest pitfall political gamblers are likely to make at the coming General Election is to assume that Tory poll leads will simply translate into a Commons majority. As we’ve been saying here for months the way the seats are distributed gives Labour a huge advantage and whenever we have reported new poll results we have also tried to demonstrate what this would mean in terms of seats at Westminster. Our main tool has been the calculator produced by the Cambridge and now City mathematician, Martin Baxter. This operates using a uniform national swing and it is very simple to work out a given outcome from new poll findings.

Now a new tool that should interest political gamblers considering General Election bets has been produced by the polling commentator, Anthony Wells. He’s created, for download, a spreadsheet that allows simple projection of the House of Commons on any given share of the vote.

    All you have to do is enter percentage vote shares for Labour, the Tories and the Lib Dems and up comes a projection of what the new Common make-up would be. All very simple.

You can choose either the current boundaries, or the new Scottish boundaries. The Wells programme differs
slightly from Martin Baxter calculator, which we use a lot on Politicalbetting.com, due to slightly different
methodology when dealing with split wards. Comparing the two the Wells system seems to be less generous to the Lib Dems. Thus taking the May Populus Poll the two calculators produce the following predictions.

Populus Poll: CON 36%, LAB 32%, LIB 22%
In Commons seat terms these vote shares convert to-
WELLS: CON 253 seats; LAB 305 seats; LIB 56 seats
BAXTER: CON 245 seats; LAB 305 seats; LIB 65 seats

A useful function with Wells allows the user to include anti-Labour tactical voting. The figure is the percentage of those voting for a third candidate (who must be significantly behind the second placed candidate) who would instead vote tactically against Labour. Anthony points out that this is very basic at the moment, and unrealistic figures would produce odd results. This is the Wells calculator version of the May Populus Poll with a 10% third party tactical voting element.

WELLS (10% Lab Tactical) CON 262 seats; LAB 295 seats; LIB 57 seats

Another polling expert, Chris Lightfoot has produced his own one-dimensional calculator based mainly on Martin Baxter’s system.

No doubt that at the General Election the BBC and several of the newspapers will be making their own versions of the Wells and Baxter calculators available. Now all we need is a 100% accurate system for determining which opinion poll is the most accurate.

WILLIAM HILL UPDATE: More readers recorded problems yesterday trying to place bets on Norris in the London Mayoral market. It seems you can put as much money as you want on Livingstone – but hardly anything on Norris. This is creating a false market. When last week’s poll came out showing Norris only 5% behind Ken the prices should have got much tighter. This has not happened in any significant way. If you have any more experiences please let us know. What better argument can there be in favour of betting exchanges!



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Why we think John Kerry will win

Tuesday, May 18th, 2004

no bushbushkerry

Unlike almost all the other political betting markets that we comment on we have refrained from making a call on the eventual result of the 2004 US Presidential Election because we have not had a clear view. But now we have come to the conclusion that Senator John Kerry can and will win in November.

    What has persuaded us is the view that Kerry will not win the election; Bush will lose it. The lacklustre performance of Kerry to date owes, we think, to his realisation that the election is first and last a referendum on Bush.

Thus the significant poll figures to follow are not Bush v. Kerry but Bush’s personal approval ratings – down again this week to 42%. Almost right across the board, issue after issue, these numbers are on the decline. By comparison in the immediate aftermath of 9/11 Bush’s personal rating was 90% and at the turn of the year he was getting 60%.

A key part of this strategy is for John Kerry to do what Tony Blair did so successfully at the 1997 UK General Election when he persuaded traditional Tories that a Government led by him would be “safe”.

    Is John Kerry’s quiet approach and his very public “wooing” of John McCain – the Republican Senator from Arizona, beaten for the nomination by Bush in 2000 – a way of saying to Republicans that it’s “safe” to support him or even just not to vote for George W. Bush? If significant numbers don’t turnout for the President then Kerry is in.

We have been impressed by John Kerry’s attempt at bi-partisanship and the way he is building up awareness of his relationship with and McCain who like Kerry is a Vietnam veteran. The New York Times observed at the weekend that John Kerry refers to John McCain whenever he is able to and the two men’s joint initiative on Vietnam POWs figures prominently in his TV campaigns.

Whether McCain would come on the John Kerry ticket as the Vice-Presidential running mate is unclear. But it very much helps Kerry for this speculation to continue.

The John Kerry price on who will win most votes in November on the Iowa Electronic Markets, described here in March, has been notching upwards to the point where it is almost on level with Bush. In the UK you can still get more than 2.2. BET.

UPDATE – UK GENERAL ELECTION SPREAD BETTING. In the Monday Call yesterday we commented that the weekend moves against Labour on the Commons seat market were an “over-reaction”. They’ve now slipped back to where they were at the end of last week – LAB 320-330; CON 248-258; LIB 53-58.
UPDATE – LONDON MAYORAL ELECTION. William Hill is offering a good price on Norris but seems to be restricting punters to ridiculously small stakes. One Politicalbetting.com reader said he could only put on £1.54 – another only managed to get £0.76 on. The bookmaker price affects the betting exchange price which is not moving. Does anybody know why William Hill is doing this? Their 1.12 on Ken is so low that you cannot imagine that it will be attracting many backers and they seem to be restricting bets on Norris. It is almost as though they do not want to be in this market.



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Monday Call – May 17 2004

Monday, May 17th, 2004

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Party winning most seats at UK General Election. Our CALL is to wait until after the Euro and Local Elections on June 10 and then BACK LABOUR when the prices will be better. As happened last time the Tory Euro win had no impact on the General Election. The mood might be different now but the Westminster seat distribution means that the Tories need to be 7% ahead on votes to be equal on seats and they are nowhere near that in the polls. To win a Commons majority Michael Howard needs a 10% lead on votes. Tony Blair/Gordon Brown can do it even if Labour is 2% behind.

Spread Betting on Commons seats. The pressure on Labour has seen the spreads drop even further during the week to well below the 324 seats that the party needs to secure an overall Commons Majority. Currently LAB 318-228; CON 250-260; LIB 53-58. With this form of betting if you think that Labour will get more than 328 then you BUY and will win your stake multiplied by the number of seats that they get above 328. If Labour gets less than 328 then you lose on the same basis. We think that the latest movements are an over-reaction but we see no value in any of these spreads. DON’T BET.

Labour Leader at General Election. Gordon Brown was almost at the same level as Tony Blair yesterday but we are not convinced that Tony Blair will be going so DON’T BET in the Betfair and William Hill market. If you think that Blair will not be there William Hill’s price is much better.

Mayor of London – person or party. The news that the Green Party is refusing to endorse Ken as their second preference choice because he is Labour candidate could be decisive. Last time Ken received more than 160,000 first and second preference votes from Green supporters. Our long-standing call that this is a close race remains. We think that Ken Livingstone and Steve Norris have an equal chance of winning. The current price on Norris is at least TWENTY-FIVE TIMES that of Livingstone. Even if you are not convinced it is worth a punt at 6 or 7 to one. With every national and local poll showing the Tories increasing this gets tougher for Ken by the day. BET before the next poll comes out.

US Presidential Election. The UK price on Kerry has held up even though Bush has had a pretty awful week. We aim to be making a major call on this election this week.

Kerry’s Running-Mate. The Irish-based but US-focussed Tradesports betting exchange is running a market on John Kerry’s choice as Vice-Presidential running mate. It lists fifteen possibilities with the current favourite being John Edwards who put up such a good show in the primaries. Our call at the price of about 5 is the “none of the above” option.

Will the result be challenged? Looking back to the Bush-Gore race of 2000 Tradesports has a market on the “2004 Presidential Election is Certified on or before Dec 13 2004”. Surely there will be no repeat of the Florida mess-ups last time – or will there? If it’s a close result, as seems likely, the precedent has been set for making challenges in the courts. At a price of about 8 it might be worth a small punt.

UK Euro Constitution Referendum. Even though the terms of the new EU constitution have still to be agreed one bookmaker has now opened a market on which way the country vote in the referendum that was promised by Tony Blair last month. This seems to be totally premature. We do not know what the vote will be about, what the question will be and when the referendum will take place. The odds are not very encouraging on either side. DON’T BET.

NOTE: When we make a call we are stating that we believe that the chances of something happening are better than the odds that are available. All prices quoted are as at time of posting. We endeavour to ensure that material is accurate when posted. However Politicalbetting.com can accept no respnsiblity for the information on the site or opinions expressed. Users make bets entirely at their own risk.



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Arbitrage bonanza as Brown touches FAVOURITE status

Sunday, May 16th, 2004

Brown
Heavy betting on Gordon Brown this morning made him favourite to be Labour leader at the General Election. This is the first time he’d been ahead of Tony Blair. The move was short-lived for technical betting reasons and not politics

Two bookmakers were offering odds on Blair going that were so out of line with the betting exchange prices that it was possible to bet against Blair in one market and bet on him in another and be sure of a certain profit. The effect was to harden the “Blair will stay” price as punters covered their position on “Blair will go”.

    At one stage, as was pointed out here at 10.12am, you could back Blair on Betfair at evens and bet against him on William Hill at 2/1 making a certain profit.

It’s not often that such a “sure thing” happens in betting and a number of Politicalbetting.com users were able to avail themselves of the opportunity before the price moved more into alignment less than anhour later.

Now William Hill has reduced its price so the markets are more in line.

The current bookmaker prices are artificial and do not reflect the money pressure in a market. This is because they place severe restrictions on the amount an individual punter can place. These are depressing the betting exchange prices on Blair going – but this should only be temporary. Unless there’s some political change the market pressure, as seen this morning, is on Blair going before the General Election.

Before betting for or against Tony Blair check the full range of prices.



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Should you bet NOW on the EU referendum result?

Saturday, May 15th, 2004

eu blair
Even though the terms of the new EU constitution have still to be agreed a UK bookmaker has now opened a market on which way the country vote in the referendum that was promised by Tony Blair last month.

This seems to be totally premature. We do not know what the vote will be about, what the question will be and when the referendum will take place. The odds are not very encouraging on either side – 4/9 on “No – Reject Constitution Question” and 13/8 on “Yes – Agree To Constitution Question”.

From the bookmaker’s point of view such markets are wonderful. They get hold of punter’s money for months or even years. The only reason to bet in such a market would be if the odds look so promising that you want to get on it now. That does not seem to be the case here.

The Politicalbetting.com recommendation is stay well away for the moment.

BETTING MARKET UPDATE

William Hill has now opened a market on Blair to be prime minister before end of next general election. If you are betting against Blair then the prices seem better than on Betfair’s “Who will be Labour leader at the General Election”.

UPDATE ON JUNE 10 EURO ELECTIONS

A reader has pointed out that according to the Electoral Commission there has been a change in the way the results will be declared compared with previous UK Euro elections. This will be done by local authority area rather than by Westminster constituencies. Although this could weaken the effect that was described the party officials at each count will easily work out their own rough seat by seat break-down. The detailed information may not be as public but the vulnerable MPs will be fully aware.

LONDON MAYOR BETTING
Another reader has contacted us to state that he stands to win over £11,000 for stakes of about £1200 on Betfair if Norris wins – a series of bets he made after reading our analysis on Politicalbetting.com. He notes that a total of £57,000 has been backed on Livingstone at an average of under 1.2 – so the overall winnings on Ken in the market would be about the same – £11,000. The only difference is that the Ken backers have at risk FIFTY TIMES more money than he has. What an extraordinary variation between the two prices. We make Livingstone and Norris about even – it all depends on turnout.

Sadly the prices have moved and now Norris is at 6.2. You can get 7.5 with William Hill but they restrict you to £100. Even at these lower prices this is still a great value bet.



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Will June 13th 2004 mark the end of the New Labour dream?

Friday, May 14th, 2004

New Labour

    How will MPs react if they are on the “at risk” list?

For on that Sunday, three days after the voting, the results of the 2004 Euro Elections will be announced. And the form in which these will be presented will be to itemise, party by party, what happened in every single Westmister seat. The aggregate results from each region are used to determine who gets elected.

So sitting Westminster MPs will be able to look at the precise result in their seat and see what would have happened if this had been the General Election. It might not make comforatable reading. Five years ago, when the opinion polls were showing big Labour leads the Tories came top.

May 1999 MORI poll: CON 28 LAB 52 LIB 14
May 1999 ICM poll: CON 28 LAB 51 LIB 16
June ’99 EURO result: CON 34.2 LAB 26.8 LIB 12.1

This produced the following notional seat split based on the actual votes in each Westminster constituency with a comparison from the 1997 General Election.

LAB 266 (-152)
CON 352 (+187)
LIB 3 (-43)

So what will happen this time with the Lib Dems and Conservatives 6-10% BETTER OFF and Labour 20-26% WORSE OFF?

May 2004 YouGov poll: CON 40 LAB 36 LIB 18
May 2004 Populus poll: CON 36 LAB 32 LIB 22
June ’04 EURO result: CON ??? LAB ??? LIB ???

For William Hague the 1999 Euros were the high point of his Conservative leadership and in the General Election in 2001 his party won just one seat more than in the previous General Election.

    The difference between now and then is that Labour has seen a collapse in its suport and there’s been a revival of both the Tories and Lib Dems. Thus in the bleak post-Iraq political environment of June 2004 there will be no comforting opinion polls for Labour MPs to console themselves with.

How will the perhaps 200 Labour MPs who see their seats notionally “going Conservative” react? Who will they blame? Will Tony Blair’s brilliance at winning elections be questioned?

Of course these are Euro elections with very low turnouts. This might be ameliorated by the decision to hold, in many places, the local elections on the same day. There is also the all-postal voting experiment in three of the regions designed to improve turn-out and make things slightly better for Labour.

But still there will be a lot of nervous Labour MPs who’ll be trying predict what is going to happen to them. Could Sunday June 13 be the tipping point?

Political gamblers should be very careful. The Tory General Election price should fall and Labour rise. On the Tony Blair and “Still party leaders” markets there will be big price moves. This should be the moment to get good value on Labour for the General Election.



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The money’s chasing the Tories in the wrong market

Thursday, May 13th, 2004

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The fact that political gamblers are people who back their views about political outcomes with hard cash does not make them any more “right” than the rest of the population. In fact the nature of gambling is that at least half of all the money that’s bet will be lost.

    At the moment we see big money going on the Conservatives for a General Election win that could be two years away with all the uncertainties not least because there could be a new Prime Minister– and conversely it’s going on Labour in the main betting market in the elections that are just four weeks away – a day when many are predicting a Labour “voters’ strike. “

The General Election SELL price on Labour has dropped from 335 to 320 seats since early April. There’s significant money going on the Conservatives to win most seats and in five weeks the price on the Betfair betting exchange, a sensitive barometer of the market mood, has moved from 4.5 to 3.6. Last night’s spread betting changes were:-

LAB 320-330 (-3)
CON 248- 258 (+3)
LIB 53-58 (+1)
Lab need 324 seats to maintain a Commons majority.

The “Tories winning most seats” bet is one that we have been urging punters to avoid because the distribution of Commons seats makes it very difficult for the Conservatives to achieve this goal. On a uniform national swing they need a lead on votes of at least 7% and until now that has seemed completely out of the question. Thus even if the Populus poll with its unadjusted Conservative lead of 6% was repeated on a national basis the Tories would still be 26 seats behind Labour.

But in the only big market for the June 10 elections political gamblers continue to pile the cash onto Labour in the London Mayoral Election. At the time of this posting you can still get 7 on the Tories and 9 on Steve Norris.

    Why should Tony Blair be seen as such a disaster for the General Election but his chosen man for London be seen as such a hot favourite in the voting that takes place in just four weeks time? If London voters want to give Blair a bloody nose in the London Mayor election their only option is NOT to support Livingstone.

Political gamblers are being totally irrational especially in the light of this week’s YouGov poll which had him just 5% ahead amongst those “certain to vote”. Yes Ken Livingstone does have a personal following but is it going to be big enough to outdo the huge Tory surge that’s going to produce gains everywhere on “Super Thursday”?

You make real money political gambling when you go against the tide.