A VC - Latest Comments in Polls vs Markets

Re: Polls vs Markets

randomwalker — Wed, 10 Sep 2008 04:22:57 -0000

In addition to what andy said, intrade *has* been getting tighter in the last few days -- it's now around 55-45 obama, not 60-40.

BTW, Andy -- a three point lead by itself doesn't mean much, you need to know confidence intervals to turn that into probabilities.

Re: Polls vs Markets

shassinger — Tue, 09 Sep 2008 08:34:39 -0000

I really like the work being done on fivethirtyeight.com -- heard Nate Silver, the force behind the site, on NPR and was attracted to the transparency and rationality of his methodology.

Re: Polls vs Markets

fredwilson — Mon, 08 Sep 2008 11:33:45 -0000

It sure is a big move. The sarah palin factor is at work

Re: Polls vs Markets

Tom Royce — Mon, 08 Sep 2008 10:13:48 -0000

It looks like things are tightening up...

Intrade Real Time Quotes 48% McCain - 53% Obama

That is a big swing amongst the betting folks out there.

Re: Polls vs Markets

LukeG — Sat, 30 Aug 2008 08:09:14 -0000

In the obvious/stupid vein, how does that math break down?

Re: Polls vs Markets

fredwilson — Fri, 29 Aug 2008 19:23:25 -0000

You of course

Booyah

Re: Polls vs Markets

howardlindzon — Fri, 29 Aug 2008 18:23:25 -0000

More important, who should Jim cramer pick to be his replacement on mad money.

Re: Polls vs Markets

Nigel Eccles — Fri, 29 Aug 2008 17:21:52 -0000

The Political Betting link was broken. It is at: www.politicalbetting.com.

Read the top post by a dispassionate British observer: http://politicalbetting.com...

I personally am amazed that Obama is trading as low as 60%.

Re: Polls vs Markets

Nigel Eccles — Fri, 29 Aug 2008 17:09:29 -0000

McCain bombed last summer,, in the polls and on the markets. When he hit rock bottom in September he was trading at about 2-3%.

Prediction markets respond to sentiment in the same way that stock markets do. If external data is saying the company isn't performing well then the price will drop. Last September, John McCain was the about the only one on the Straight Talk Express. He worked his way back and his price rose with it.

Re: Polls vs Markets

fredwilson — Fri, 29 Aug 2008 16:16:15 -0000

Andy, I've rewarded you for being a thorn in my side today with the comment
of the day

http://www.avc.com/a_vc/200...

Re: Polls vs Markets

andyswan — Fri, 29 Aug 2008 16:09:14 -0000

And to think all that time, she was merely running a state. :)

Of course, she isn't on the top of the ticket.

Re: Polls vs Markets

fredwilson — Fri, 29 Aug 2008 16:03:10 -0000

Obama has been tested by a year long primary campaign where he had to behead
the king and queen

She has not

Re: Polls vs Markets

andyswan — Fri, 29 Aug 2008 15:53:26 -0000

I'm sure the McCain camp is looking forward to hearing exactly how the
dems define "ready" and "experienced"... Brilliant trap

an inspiring feminist story for
women, moms and fathers of daughters.

Re: Polls vs Markets

fredwilson — Fri, 29 Aug 2008 14:43:23 -0000

A 72 yr old man should pick someone who is ready for the white house as his
VP

Re: Polls vs Markets

Nigel Eccles — Fri, 29 Aug 2008 14:05:42 -0000

Interestingly Intrade's forecast for Obama is actually at the low end for the betting markets. If you take the prices from Oddschecker (http://www.oddschecker.com/..., strip out the overround (that's the bookmaker's margin) and convert to percentages, you will see that Obama is trading at between 61% and 65%.

Around the question if the betting markets are likely to be politically biased, this is highly unlikely. Many years ago you could make money by, for example, betting against England when betting with a English bookmaker (and then potentially arb it by laying off with a Swedish bookmaker) however the betting markets are so transparent and so many bettors use bots that systematic bias doesn't really occur (or if it does it is fleeting).

The Hubdub presidential market has been consistently about 5% more in favor of Obama than the betting markets. We believe part of the reason for this is the automated market maker we use but we are still investigating. We believe it isn't because of emotion based trades (as someone suggested above). The price the market settles on is mostly controlled by our heavy traders. These users spend up to several hours a day on the site competing with friends and trying to climb the leaderboards. They tend to treat their trades as they would real money. The emotion based trades cause volatility but shouldn't set the long term price.

Re: Polls vs Markets

tpurves — Fri, 29 Aug 2008 13:17:53 -0000

Polls don't necessarily consider turn out. This election is likely to be a landslide based on turnout. Obama was smashing democratic turnout records in the primaries.

It doesn't matter how many supporters you have, it's how many get to the voting booth (and how many of those votes are counted but that's another story).

Re: Polls vs Markets

andyswan — Fri, 29 Aug 2008 13:03:22 -0000

Gotcha. Agree integrity of voting is everyones issue.

Re: Polls vs Markets

MattKane — Fri, 29 Aug 2008 12:58:50 -0000

His price (for nominee) on Betfair spiked to around 35 last summer, which would imply he was being written off by the punters too. You can see the graph here: http://bit.ly/2LFcVq though for some reason it doesn't show the dates on the axis. To give you an idea, I backed him at 7.8 in late December. I then covered that bet by laying at 1.07 in April, so I'm in the money even if he drops dead or something.

Re: Polls vs Markets

MattKane — Fri, 29 Aug 2008 12:50:33 -0000

I think it's undoubtedly true that people are lot more candid when they've got money on the line. Another interesting place to watch (though you can't place bets if you're in the US) is the politics markets on betfair.com which is a betting exchange, and spreadfair.com, which a spread betting site. I've already made some nice beer money on various US election markets on there. Politcalbetting.com is the UK's most popular political blog and covers a lot of this kind of stuff. Much of it is inevitably UK-specific, but there's obviously a lot of US coverage at the moment, as well as worldwide.

Re: Polls vs Markets

kidmercury — Fri, 29 Aug 2008 12:45:41 -0000

i don't know for sure, but where there are diebold machines there are going to be problems. the hacking of diebold machines has been a big problem -- here is one good article among many others:

http://www.engadget.com/200...

it's worth noting there was also a lot of controversy surrounding the 2008 new hampshire primary on both the rethuglican and dumbocrat side, with evidence suggesting both obama and ron paul were robbed of votes. there are plenty of people arguing both sides of the issue, so it is tough to prove with certainty. below is a google serp that may help people make their own opinion.

http://www.google.com/searc...

ultimately the diebold issue is very real. so i don't know for sure but it certainly seems possible if not likely that there were issues with the 2006 congressional election as well.

Re: Polls vs Markets

Jake — Fri, 29 Aug 2008 12:37:45 -0000

Great explanation Andy. I think that one simple way to look at the disparity is to ask what the two different numbers are getting at.

Polls ask the question, "Who will you vote for" whereas the markets ask the question "Who will get more votes overall"

Re: Polls vs Markets

andyswan — Fri, 29 Aug 2008 12:31:57 -0000

I was dead wrong about Romney being the pick....but this one is even better. Newspapers saying "Obama who?" all weekend after his amazing speech....and "diversity" on both sides of the ticket with a kick-ass woman that Biden can't assault.

Maybe McCain isn't as lame as I originally suspected...

Re: Polls vs Markets

iWonder — Fri, 29 Aug 2008 12:30:10 -0000

How did these markets do at predicting McCain as the nominee, back when everyone counted him out?

Re: Polls vs Markets

steveray — Fri, 29 Aug 2008 12:29:47 -0000

Every year when the entire college football community argues about the national rankings (which determine the allocation of $millions for bowls) I make the point that the people who make the polls should have money riding on them. Every week's ranking should in effect be a bet. You'd get much more accurate rankings that way.

Re: Polls vs Markets

gyardley — Fri, 29 Aug 2008 12:26:29 -0000

Hmmm - the HubDub market leans way more Democrat than the Intrade market. That's probably because the HubDub markets use play money while the Intrade markets use real money - in the HubDub market, it's all for fun, so you can make emotion-based trades.

Of course, people trade emotionally in real-money markets as well. Do we think the InTrade community slants Democrat or Republican? I personally suspect there's at least a few percentage points of wishful thinking in the InTrade numbers, and a lot of the trades are of the 'let's bet on my favorite sports team for fun' variety instead of the 'okay, let's rationally make some money' variety.