Why the US betting support?
The 2020 US Presidential Market is gathering steam right now with most of the top-tier Democratic possibles having announced their candidature. Just waiting on Joe Biden who has recently become favourite for the nomination at Ladbrokes. No doubt his price will drop a little further if and when he announces, but the bigger impact on the overall market would be if he says no.
Oddly though, the biggest loser with Ladbrokes would be someone who the vast majority of US voters have never heard of, and typically polls at 1% (if pollsters even bother to include him):Andrew Yang.
He’s been backed down from 200/1 into 33/1 to be elected President and now shows at just 16/1 fifth favourite to be the Democrats’ nominee. Amazingly he’s now ahead of people like Elizabeth Warren and Cory Booker in the betting.
He seems like a smart guy and is pushing a few unique policy positions, notably Universal Basic Income. His odds are no doubt massively influenced by his appeal to a young, internet savvy fan base and this feels a lot like the huge 2008 gamble on Ron Paul to become President. Despite hovering at around 5% in polls of Republican voters for most of the run up to the primaries, Paul got down to around 12/1 in the outright Presidential odds as an army of fans backed him to win.
Also, take a look at how highly American punters like Yang’s chances. Here are the latest odds from PredictIt.
That makes him about 9/1 on the only platform that US citizens can legally bet on politics. Although people from outside of the US can’t trade on PredictIt, it will have a knock on effect on the rest of the worldwide betting market, as a lot of people will no doubt assume that the US facing odds are more accurate. I think there’s a big problem with this though which arises from the very restrictive terms on which PredictIt allows people to bet. For regulatory reasons, they don’t allow people to have more than $850 at stake on any one contract, which hugely limits the ability of layers to resist market moves on outsiders like Yang (who probably has a lot of small-staking fans).
PredictIt also has some quite high commission charges, which makes it quite hard for anyone to correct any arbitrage opportunities, even if they could get access to US and non-US odds. So, we might continue to see some pretty big differences in the two markets right up until election day.
On the plus side for Yang, the rules for who gets in the Democratic debates later in the year mean he’ll probably make it (because of the number of individual doners to his campaign) whatever his opinion poll rating shows. Perhaps that will give him a big boost, although he probably wouldn’t get more than a few minutes to say anything very much.
I won’t be backing him, but I have had a bit of money on another little known outsider, Pete Buttigieg, who I think might have a better chance of making a run for it. Ladbrokes have him at 50/1 to be elected POTUS. Don’t know if anyone has any past examples of 50/1 Presidential election winning bets?