Election Day on Intrade

Well everyone, it’s finally here.  Please feel free to post comments or tweet me today.  Tell me your predictions, trades, and how you think it's going.  All the Senate Control contracts seem to be trading below 50%.  One of them is going to expire at 100%, so this is going to be a very interesting night.  Colorado, West Virginia, Nevada, Pennsylvania, and Washington are the hot states to watch for the Senate tonight. 

I personally have some contracts going long on Rubio (R) in Florida, Johnson (R) in Wisconsin, Murray (R) in Washington, Prop 19, Senate Neither, and Rep.Senate.50+.

I have contracts going short on Buck (R) in Colorado and Toomey (R) in Pennsylvania. 

I don’t have any House contracts.  I didn’t want to invest all the time and energy into them required.  I don’t think I’ll win everything today.  My PA, CO, and Prop 19 positions to be more specific. PA and CO are hedges against my Senate Control contracts and my position in Prop 19 is leftover from when it was still leading in the polls.  Good luck to everyone.  If I find any trades I think are good, I’ll tweet or post them after I’ve gotten what I need. 

Intrade Senate Snapshot (11/1/2010)

Well it now looks like the two most important states to watch will be Colorado and Washington. Washington being the most likely Republican upset and Colorado being the most likely Democrat upset. (D) Sestak's chances in Pennsylvania are now very slim and PPP came out with a poll showing (R) Toomey with a 5 point lead. Looks like my bet there will not win but I considered it a hedge against my Senate Neither trade which looks spot on the money now. If Washington goes to the Republicans (I have some contracts going Long on Rossi now) and Intrade gets all the other Senate races right, we'll see a 50-50 Senate, with VP Biden casting the tie breaking vote. That'd be kinda fun for the next two years.

Intrade Senate & House Forecast (10/25/2010)

The polls are going all over the place and it’s getting hard to believe any poll at face value. Unless polling is seriously underestimating the “enthusiasm gap,” I don’t think we’ll see a Republican Senate. It’s still in play but the clock is starting to run out. The question now is whether Republicans make it to 49. This also depends on a bunch of toss ups going favorably their way. Nevada and Illinois are starting to look Republican lean but Democrats are threatening in Colorado and Pennsylvania.

The House

The Senate

Colorado and Pennsylvania are looking to be the nail biters that everyone thought Illinois and Nevada would play. Sharon Angle seems to be in the lead right now with early voting going on so some of these polls gives us information on polls cast today. I'll think she'll win this one but it's still going to be close and she might not be worth at 62.9%. Illinois still has many undecideds but has been steadily trending Republican this cycle. California has also been steadily polling for Boxer even though Fiorina is still within striking distance.

Pennsylvania and Colorado have been very sporadic in the polls and Republicans could be more vulnerable there than previously thought. Bennet seems to be slowly catching up to Buck and may overtake him by election night. Polling in Pennsylvania has been mostly in favor of Toomey and he is definitely still the favorite now. I think this race is closer then it appears and I still think Toomey is overvalued.

Intrade Senate Snapshot (10/24/2010)

All the action on Intrade seems to be focused on the Senate races. Here is a quick snapshot of the political markets.

*Intrade considers Murkowski as Other in the Alaska Senate Market but as a Republican for Congressional control contracts.

Is Pennsylvania Now a Toss Up?

Yesterday, PPP surprised the hell out of me and reported that Democrat Joe Sestak now held a 1 point lead over Republican Pat Toomey. The result came from what I consider a reputable poster and  two Democratic internal polls also showed a lead for Sestak.  Although these internals are probably biased towards Sestak, the fact that these polls would show him in the lead at all, shows that the race has significantly tightened. 

Now, a new poll by a Morning Call/Muhlenberg College Tracker poll shows Sestak at 44% and Toomey at 41%.  Looking over past polls, I can only find two instances since September where Toomey polled 50% or higher.  If Toomey had locked this race up like it appeared, I would have expected many more results with him above 50%.  For example, (R) Ron Johnson has polled above 50% nine times in the Wisconsin Senate race since September. 

I decided to pull the trigger and short Toomey on Intrade at 75%.  In my opinion, he’s no longer a 3 to 1 favorite and I don’t know if I can honestly claim he’s still the favorite.  Polling in Pennsylvania will no doubt come out soon to try and confirm whether or not there is a trend in favor of Sestak.  I’m betting there is and that by election night, Joe Sestak will have another comeback to celebrate.

Intrade Senate & House Forecast - 10/19/2010

With two weeks to go the battle for the Senate has intensified.  More races seem to be in play and polling is starting to get sporadic. Two weeks ago, it seemed like we might only have three races to worry about, Washington, Nevada, and Illinois.   Now I am tracking 9 races with both candidates trading above 20% and under 80%. 

The House of Representatives

Predictions for the House have continued to get worse and worse for Democrats.  Each week that has gone by has seen Republican gains increasing and now bettors on Intrade are saying it is 63.9% likely that Republicans gain 55+ seats in the House of Representatives.  This would be a gain greater than 1994!

 
The Senate

Polls for the Senate are starting to get sporadic and the only trend that I can find is that most races are becoming more unpredictable or more competitive.  PPP and Rasmussen seem to be differing from each other more often than not and internal polls from both sides seems to be aimed at changing the perception of the races they poll and not realistically portraying the electorate as they should. 

By counting every individual seat, Intrade is predicting that Republicans will have a total of 49 seats.  Just enough for the Senate Neither contract to expire at 100%.  Despite the number of changes that have happened over the past week, Republicans seemed to be headed for just enough seats to not gain a majority.  This has been a trend throughout this electoral season and I expect it will probably continue until election day. Republicans seem to be competitive in many more races than Democrats and across the board are winning votes on the margins, where it matters most.

Senate Forecast	Democrats	Republicans	Independents
Grouped	52.07	48.06	2.08*
Individual	49	49	2

 

*Intrade counts Sen. Lisa Murkowski as a Republican for the Senate Control contracts.

Will Intrade Consider Sen. Lisa Murkowski to be a Republican or Independent?

Both.

I asked Carl Wolfenden (Intrade's Exchange Operations Manager), about how Intrade would handle the Alaska Senate Contracts and the Senate Control contracts if she won. Here's his answer.

Thanks for your enquiry. For the Alaska Senate race market Lisa Murkowski is considered an OTHER because Joe Miller is the official Republican candidate. But Murkowski is officially running as a Republican so if she wins the seat will be considered a Republican seat for purposes of our Senate control and Republican seats markets.

- Carl Wolfenden

I'm busy today but I will do the Intrade Senate Forecast later.  

Republican Senate May be a Bridge too Far

As it stands right now.  Of the four closest Senate races; Illinois, Nevada, Washington, and West Virginia, Republicans would need to win all four in order to control 51 seats.  For those betting on Intrade, the situation gets more complicated with Murkowski putting up a fight in Alaska. 

The Republican candidate in Illinois, Mark Kirk was at one point in this electoral season, a 70% favorite on Intrade to win the seat. Right now, both the Democrat and Republican candidate last traded below 50%! Usually, candidates are overvalued in electoral markets, but the fact that the market is undervaluing both Kirk and Giannoulias shows how much of a toss up Illinois truly is. I have taken no position in this race and I’ll probably stay away until election night. 

In Nevada, Sharon Angle has continued to keep up with Harry Reid in the polls and it may finally be starting to go her way.  She raised an astronomical $14 Million in the 3rd quarter and is listed 1st on the Nevada ballot thanks to the fact that candidates are listed in alphabetical order.  For Sen. Harry Reid, staying on as Senate Majority Leader rests mostly with his ability to keep his own seat.  There aren’t very many scenarios where he wins Nevada and Republicans take over the Senate.  Sharon Angle last traded at 48.1% but there is currently a lot of 250 contracts bidding at 50.1%.

In Washington, Republican candidate Dino Rossi was almost considered out of it as the Democrat candidate Patty Murray looked like she was starting to run away with it.  A month ago, she was trading around the mid-60’s on Intrade and looked as good as a 2 to 1 favorite.  Rossi has come back to make it competitive but it still might not be enough. The latest Rasmussen poll continues to show Rossi but as Nate Silver recently pointed out, Rasmussen also has a history of overestimating the Republican’s chances in the state.  I’ll agree with traders on Intrade that Washington is currently leaning toward the Democrat.  Patty Murray last traded at 58% to win the Washington Senate seat. 

Finally, we get to West Virginia where a really popular Democratic Governor Joe Manchin decided to run for Senate and is facing a tough electoral battle against Republican candidate John Raese.  West Virginia was mostly ignored during this electoral season until Raese won the primary and surprised everyone by catching up to Manchin and then him passing  in the polls.  A recent poll by PPP now has Manchin in the lead by 3% but he still remains behind by 2.4% in pollster.com’s average of the polls.  I favor Raese in West Virginia and I personally have some contracts shorting (D) Joe Manchin. 

What all these four races show is that the Democrats are not losing without a fight.  No doubt Republicans can win any one of these four races, but they have to win four races for a majority and that might simply be out of their reach. If I had to list which states are most likely to go Republican, I would list them in this order, #1 West Virginia, #2 Nevada, #3 Illinois, and #4 Washington.

Intrade Mid-Term Forecast (10/12/2010)

Republican’s chances to win the House and Senate continue to improve with every passing week. With three weeks left until election day, Democrats are not getting enthused to go to the polls and vote for their candidates with the same ferocity as Republicans. This enthusiasm gap continues to push race after race into the Republican camp.

The House of Representatives

Republicans are continued favorites to win the House, trading close to 80% to win control.

The biggest change in the chart below is that the probability of Republicans gaining 50+ seats in the House has increased 23.1% in less than 3 weeks! The contract is now trading at 64.1% and that’s practically 2 to 1 odds! The bulls are betting heavy on Republicans.

The Senate

Republicans continue to gain Senate seat after seat and Nevada is now the latest state favored by Intrade to fall to Republicans. The recent movement in favor of Sharon Angle may be coming from recent polls that show her in front and news that Sharon Angle is listed 1st on the Nevada ballot and Harry Reid is listed 7th. The Tea Party candidate Ashjian is listed 2nd however and might siphon off some votes from Angle. Currently, if you count each individual race Republicans are now favored to win 50 Senate seats.

Intrade Senate Forecast	Democrats	Republicans	Independents
Grouped	49.00	48.85	2.41
Individual	48	50	2

The Senate Neither Contract on Intrade

On Intrade, you can trade three contracts for US Senate Control, the (SENATE.DEM.2010) contract, the (SENATE.REP.2010) contract and the (SENATE.NEITHER.2010) contract. The (SENATE.DEM.2010) contract is not what it seems and due to the contract language, it is not the same as Democrats keeping control of the Senate.

The three contracts state.

For expiry purposes any Senate seat held by an Independent who caucuses or votes with the Democrats will be considered Independent and NOT a Democratic seat. The same rule applies to any Independent who caucuses or votes with the Republicans.

There are currently two Independents in the Senate that caucus with the Democrats. So Democrats can maintain control of the Senate but the (SENATE.DEM.2010) contract can expire at 0% if Democrats have 48 or 49 Senators in the Senate not including the two Independents already in the Senate. If Republicans have 51 seats, the (SENATE.REP.2010) contract will expire at 100% and the other two contracts will expire at 0%.

This situation gets even more complicated with the fact that two candidates for the Senate are currently running as Independents. Sen. Lisa Murkowski in Alaska who lost the Republican primary and is running a write in campaign and Gov. Charlie Crist running on the ballot in Florida after losing the Republican primary to Marco Rubio. Rep. Mike Castle has recently stated he will not run a write in campaign in Delaware despite the fact that Nate Silver figured he had a significant chance of winning. As one poster on the Intrade forum stated, an Independent winning a Senate race increases the chance of the (SENATE.NEITHER.2010) contract expiring at 100. This is because it takes away from the 51 Republican seats needed to expire the (SENATE.REP.2010) contract at 100%.

Currently, the Democrats and Republicans are headed for 49 seats not including Independents. Republicans need two more seats to control the Senate but that does not seem very likely as the seats needed to gain a majority are getting harder and harder for them to win. For example Sen. Boxer in California seems to be pulling away from Carly Fiorina and Harry Reid continues to maintain a small lead over Sharon Angle in Nevada.

Here is a chart I made to easily interpret the US Senate Control contracts on Intrade.

Contract	Scenario Needed for 0% Expiry	Scenario Needed for 100% Expiry
SENATE.DEM.2010	Democrat* seats ≤ to 49	Democrat* seats ≥ 50
SENATE.REP.2010	Republican seats ≤ 50	Republican seats ≥ 51
SENATE.NEITHER.2010	Democrat* seats ≥ 50 or Republican seats ≥ 51	Democrat* seats ≤ to 49 and Republican seats ≤ 50

Disclosure: Currently, I have a sizable position going long on the (SENATE.NEITHER.2010) contract and going short on both the (SENATE.DEM.2010) and (SENATE.REP.2010) contracts which is the same thing but currently cheaper. For the first time today the (SENATE.NEITHER.2010) contract has traded 24.4%, higher than the (SENATE.REP.2010) contract. I have to agree with the market as I think the chance of Republicans holding 49 or 50 seats in the Senate is higher than Republicans holding 51 seats or higher.

*Not including Independents caucusing with Democrats.

Intrade Mid-Term Forecast (9/28/2010)

I meant to update yesterday but my dog cut the cord for the internet at my house. Sounds like a silly excuse but I’m not making that up, I swear. In any case, it’s probably for the better because some interesting polls have come out and the Senate might actually be within reach of the Republicans once again.

The House of Representatives

The Republicans continue to stay on track to win 45+ seats in the House of Representatives. Not as many as in 1994 but still a significant amount that would give control of the House back to Republicans. The House looks all but lost for Democrats and the question now seems to be how many seats they will lose?

The Senate

Last week, the election of Christine O’Donnell in Delaware made it look like Republicans had lost their opportunity to also take control of the Senate. However, the states West Virginia, New York, and Connecticut seem to be coming into play and all three were once thought of as safe Democratic seats. In West Virginia, two polls have even come out showing the Republican in the lead. One by PPP [(R) Raese 46% (D) Manchin 43%] and the other by Rasmussen [(R) Raese 48% (D) Manchin 46%]. Wisconsin which was once a toss up has now swung heavily in favor of Republican challenger Ron Johnson who is now trading at 78% on Intrade!

I am now tracking 11 Senate seats which I think are the most competitive. All of these races have the favorite trading at 80% or below on Intrade. These are Alaska, California, Colorado, Connecticut, Florida, Illinois, Nevada, New York (Special Election), Washington, West Virginia, and Wisconsin. Currently, I consider there to be 44 relatively safe Democratic seats and 43 relatively safe Republican seats. If Castle decides to make a write in bid for the Delaware Senate seat, I’ll consider it in play. If Democratic Meek doesn’t start making serious gains against Rubio in Florida, I’ll have to consider Florida a Safe Republican seat. 

Intrade Senate Forecast	Democrats	Republicans	Independents
Grouped	49.00	48.99	2.40
Individual	49	49	2

Intrade Mid-Term Forecast (9/20/10)

As you can imagine, Intrade’s prices have changed significantly this past week for the Senate. Christine O’Donnell has significantly hampered the Republican’s chances of taking back the Senate and a write in bid by Sen. Murkowski who was defeated in her Republican primary has now put Alaska in play as well. Traders on Intrade currently are not giving her much of a chance but I have now incorporated her chances of winning into the forecast as well.

The House of Representatives

Republicans continue to have a very good chance of taking over the House and have a better than 50% chance of gaining 45+ Seats. Only 39 are required for them to gain a majority.

Here is the price history for the Republican’s chances of taking over the House.

Here is Intrade’s House Forecast.

The Senate

I have now added Alaska to the Senate Forecast. That makes 12 states which are individually tracked to acquire the information below. Next week, unless Kentucky starts getting interesting, I’m going to take it out and regard it as a Safe Republican seat. Rand Paul has been trading above 80% for over a week now. Other states I have considered taking out include Florida, Delaware, Connecticut and West Virginia.

Number of Seats	Democrats	Republicans	Independents
Grouped	49.59	48.08	2.34
Individually	50	48	2

Intrade Senate Forecast

Intrade Mid-Term Forecast (9-13-2010)

One of the great things about Intrade is that it is not a model. It a market with buyers and sellers looking for and synthesizing information. As a result it is constantly updating and can adjust to all types of information, not just poll numbers. Every Monday, from now until the election, I will graphically show what Intrade Prediction Markets are forecasting for the 2010 Congressional Elections.

The Senate

Intrade Senate Forecast	Democrats	Republicans	Independents
Grouped	48.9	48.8	2.3
Individually	48.5	49.5	2

The grouped forecast represents the combined probability of 11 Senate Races that appear to be in play. These are California, Colorado, Connecticut, Delaware, Florida, Illinois, Kentucky, Nevada, Washington, West Virginia, and Wisconsin. The prices used are of the favorite. The probabilities are then added to the assumed number of safe Senate seats, 44 for the Democrats and 43 for the Republicans. The Individual forecast simply takes the predicted winner of each individual race and adds 1 to the number of assumed safe seats. In case of a 50%/50% tie, which we have thanks to Wisconsin (.5) will be added to both.

The House

Intrade House Forecast	Republicans	Democrats
Probability of Winning	71.0%	21.0%

As you can see, the Republicans are a huge favorite to win the House and even have a significant chance of gaining more seats than 54 which they did in the 1994 mid-term elections.

The 5 Most Traded Senate Races on Intrade

With the mid-term elections heating up, the Senate races on Intrade seem to be the only ones getting the attention. Here's the rundown of the 5 Senate races you need to know about if you want to trade successfully this November.

1.) Florida - Intrade Odds:(R) Marco Rubio 50% Vs. (I) Charlie Crist 47.5% Vs.(D) Meek or Greene 6%, Vol 5734

The Florida Senate race started to get interesting when Marco Rubio started seriously challenging Charlie Crist for the Republican nomination. It got really interesting when Crist dropped out of the Republican primary and decided to make an Independent run. The fact that this race is still close shows that it was a pretty smart move on Crist's part to not go after his party's nomination when it was clearly lost. Crist may be poised for a drop in the polls once the Democrats settle on a nominee but until now, he has been handling his Independent candidacy well and has managed to get a large percentage of Democrats on his side. Marco Rubio has recently started to poll ahead of Crist and is once again the odds on favorite, but Crist has proved that he is capable of fighting this to the end. This may be the beginning of the end for Crist and with Crist splitting the Democratic vote, Rubio might finally beat out Crist.

2.) Nevada - Intrade Odds:(D) Sen. Harry Reid 58.7% Vs. (R) Sharron Angle 44%, Vol 5315

The Democratic Senate Majority leader may find himself completely out of job this November facing off against Tea Party candidate Sharron Angle. Both candidates are very polarizing and with so much on the line for the Democrats and the Tea Party, this race is bound to stay heated until election day. Sharon Angle is not your typical Republican candidate but Nevada is not your typical state. Many will doubt whether or not she can pull out this upset and this could make for a prime opportunity for some trades as we get closer to November. Right now, I'll agree with the consensus and say that Harry Reid is in the lead, but watch out for Angle. With a bad election climate for incumbents and Democrats, Angle could come out as the beneficiary.

3.) California - Intrade Odds:(D) Sen. Barbara Boxer 57.3% Vs. (R) Carly Fiorina 43.9%, Vol 1754

Sen. Boxer is facing a tough re-election battle against former HP CEO Carly Fiorina. Boxer has built a significant war chest but Fiorina's ability to self fund her campaign if she needs too will help make this a tough battle. Recent polling has both Fiorina and Boxer in the lead with SurveyUSA differing in results from PPP and Rasmussen. Currently, I have a small short against Boxer because I think she is overvalued and has a significant chance of losing this November.

4.) Kentucky - Intrade Odds: (R) Rand Paul 75% Vs. (D) Jack Conway 25%, Vol 1683

Rand Paul, son of Congressman Ron Paul seems to be leading the Tea Party to victory in the Blue Grass state. With the latest polling showing Rand Paul leading by 5% points, his price on Intrade might be a little overvalued. Jack Conway, along with left wing sites such as Talking Points Memo and the Huffington Post have been trying to portray Paul as somebody who holds views outside the interest of Kentucky and mainstream voters. As long as Paul can avoid a serious misstep or scandal, he should be well on his way to becoming a Senator in the new Congress.

5.) Connecticut - Intrade Odds:(D) Richard Blumenthal 74.1% Vs. (R) Linda McMahon 28.5%, Vol 1616

With Chris Dodd retiring, the Democrat Richard Blumenthal is poised to take over. He faces a strong challenge from self funder Linda McMahon who has the money to make this a fight. Blumenthal has gotten some skepticism for exaggerating his military service in Vietnam but has continued to have a comfortable lead in the polls. A recent poll by Rasmussen has him up by 7% points and a Republican victory the odds on Intrade reflect that he is a heavy favorite. A Republican victory in Connecticut seems unlikely and if it did happen, a Republican takeover of the Senate might be the result.

The Colorado Senate Primaries

I'm back and just in time for the Colorado Senate Primaries. Boy, did they get interesting at the last minute. For the Democrats, Sen. Michael Bennet has been trying to hold off a challenge from Andrew Romanoff who according to a poll done by SurveyUSA was leading the race by 3% as of two weeks ago. This led to the price on Intrade for Romanoff to rise to 74%.

For the Republicans, that same SurveyUSA poll also had Ken Buck beating Jane Norton (not surprisingly) by 9% points . But then yesterday, PPP came out with a poll that turned both races on it's head. That poll gave Sen. Bennet a lead of 6% points and Norton a lead of 3% points. Her first lead in the race in many, many, months.

So what happened in Colorado? Why did PPP show the race so differently from SurveyUSA, especially when both are reliable posters? I believe it is due to a number of factors.

1.) Money - Both Jane Norton and Sen. Bennet have raised more money then their respective opponents. A lot more money.

Sen. Bennet has raised $7,704,446 to Andrew Romanoff's $1,962,579. Jane Norton has raised $2,872,274 to Ken Buck's $1,260,043. Now this type of monetary difference may not make a difference among the hardcore party activists, who probably support Romanoff in the Democratic party and Ken Buck the tea party favorite in the Republican party. But it may make a big difference with Getting Out the Vote efforts and advertising for those undecided voters who are more non-nonchalant about voting and politics.

2.) Missteps by both Andrew Romanoff and Ken Buck.

Romanoff has been very negative against Bennet and has tried to paint him as the Washington insider even though he has been in the U.S Senate for less than two years. Some of these negative ads have not been entirely truthful and may have backfired.

Ken Buck has put his foot in his mouth with two statements these last two weeks and it may cost him the election. In one statement Buck said "Why should you vote for me? Because I do not wear high heels, I have cowboy boots. They have real bullsh** on them." And in another he insulted some of the birthers that unfortunately make up a portion of the Tea Party. "will you tell those [expletive] at the Tea Party to stop asking questions about birth certificates while I'm on the camera?"

Whatever happens tonight, it will have been a very interesting race and the national media trying to paint these races as simply the establishment candidate vs. outsiders misses the point. All elections have individual characteristics that affect the narrative of the race. It is not just about how voters view the Tea Party and the Obama Presidency.

Daily Chuck Evaluation (As of Right Now)

Democratic Primary
Michael Bennet: 55%-60%
Andrew Romanoff: 40%-45%

Republican Primary
Ken Buck: 50%-55%
Jane Norton: 45%-50%

Disclosure
CO.DEM.SENATE.ROMANOFF - Selling Short - Avg 73.5%
CO.REP.SENATE.BUCK - Selling Short - Avg 65%

Pundits Wrong Again, What a Surprise...

Well, last night went just about as well as one could have hoped for. Carly Fiorina won her primary as expected and Senator Blanche Lincoln was able to pull off an upset against her primary opponent Bill Halter. It's funny how a lot of political pundits just straight up got it wrong last night and made the price on Intrade very, very, profitable for those who can handicap political races correctly. Because of last night the founder of the DailyKos is now considering dropping Research2000 as their commissioned pollster. Good for him.

An interesting aspect about last night was that the AP misreported the election numbers for about 5-10 Minutes last night sending the Arkansas Democratic Primary market into a frenzy. The price for Lincoln went from 90% to 20% in minutes. It cost a me a little money in the sense that I didn't make as much as I could have because I exited out of my positions when I was hoping to hold on to them until expiration. However, I was making trades throughout the night so I was able to make what I had originally set out with my original bet but I could have made double had AP not made that screw up or if I hadn't noticed. Below is a screenshot of the time and sales chart and you can see the dip caused solely by AP's reporting of the numbers.

It has been a lot of fun trading these last couple of weeks but unfortunately I am probably going to be out of commission for a while. I have to withdraw most of my funds and probably will not be able to make any of the bets I usually make. I'll try to keep posting box office predictions and will post on any good deals I may find but the regularity of my posts will not be as frequent as they were before I went on vacation. I'll try to be back trading as much as possible before November. For liquidity purposes I am selling some Rand Paul contracts at 65% and some Spotify contracts at 62.5%. I would keep holding on to both until expiration but having some little margin at this point would be preferred. If anyone would be willing to take them off my hands, it would be most appreciated.

Tuesday Primaries, Polling, & Bets

Tonight, a whole bunch of primaries from around the country will be decided. In Arkansas, there will be a run off between Sen. Blanche Lincoln and Lt. Gov Bill Halter. Lincoln was able to beat Halter by a couple of points in the regular primary but was not able to avoid a run off which might prove deadly to her political career. There has been very little polling in this race and the only poll we have to rely on is Research2000. They currently have Halter in the lead by +4 points but considering how unreliable RS2000/DailyKos polling has become recently, I wouldn't be willing to place a wager on Halter who is the current favorite. In fact, I have placed a small speculative wager on Lincoln at 20.5%. I just wish we had better polling. RS2000/DailyKos had Lincoln 9+ points ahead right before the primary. I'm hoping this time, they are way off again but in my favor.

In California, there are two gubernatorial primaries and a Republican senate primary. A couple of weeks back I was able to spot a SurveyUSA poll which had Carly Fiorina in the lead by 23% points opposite of what RS2000/DailyKos had found literally less then a week before. They polled the race 4 days before SurveyUSA and had Campbell in the lead by 15%. I decided to trust SurveyUSA and I shorted Campbell at the time for 50%. The lesson I learned then and what some traders might learn tonight is that there are pollsters you can trust and pollsters you can't. Some pollsters can even go from trustworthy to untrustworthy, such as Research2000. They might by right tonight, but I'm not betting on it.

Weekend Box Office Predictions and Bets (6/4/10)-(6/6/10)

In a summer that has continued to underwhelm, this weekend looks like it will continue to do the same. Two movies opening this weekend have a significant chance of breaking +$20 Million. Killers and Get Him to the Greek. Splice might be able to break +$10 Million but Marmaduke seems destined to bomb spectacularly. The only bet I have made this weekend is on Marmaduke not passing $12.5 Million. I have shorted it on Intrade at a price of 50%. Last week I made the mistake of not going with the model and adjusting MacGruber’s estimate upward. The model has constantly had trouble predicting movies under $15 Million so most of my predictions in that range are always kind of iffy. Where Marmaduke ends up at the end of the weekend is honestly a mystery to me. $4.2 Million seems really, really, low but I don’t think it will pass $10 Million. I already put a sizeable bet and there is still some contracts up for the taking at $12.5 Million. If my bankroll was bigger I’d take them, but I don’t like to put so much riding on one movie. Movies are in general extremely unpredictable.

Movie	Opening Weekend Prediction
Killers	$19.34 Million
Get Him to the Greek	$18.47 Million
Splice	$10.09 Million
Marmaduke	$4.20 Million

Box Office Prediction and Bets - Shrek Forever After and Macgruber

This weekend we have Shrek Forever After and Macgruber. Hopefully, this will be the last in the series for Shrek. As much as I loved the first Shrek movie, I feel that the quality of each sequel has been worse then the last. Needless to say I think that this movie will not open as well as the others. I have shorted Shrek Forever After at the $90, $95 and $100 Million price points on Intrade. I don't think my model's number for Macgruber is going to be very accurate so I adjusted it upwards a little bit. I have yet to get fully back into studying these numbers carefully and adjusting the model to get a more accurate prediction but I know my estimates shouldn't be too far off either.

Prediction for Opening Weekend

Shrek Forever After - $77 Million

Macgruber - $9 Million

Feels Good to be Back

Especially when I get to see this.



I bet on Rand Paul a while ago and the contract finally expired. Nice to come back home to a win. Especially after a series of losses. I'll be updating the blog and getting back to what I do best.

Blog Update

Sorry, I haven't posted in a while. I've been extremely busy with finals and spending valuable time with friends that I might not see for a while. Today, I graduated from Florida State University having majored in Economics and Political Science. In a couple of days I'll be vacationing in Europe. First time across the pond for me, so it should be fun. Needless to say posting will be light in the immediate future.

Currently, I've been selling my positions on the Lib Dems in the U.K election. I really thought that the Lib Dems had a real chance at a breakthrough. Either with a majority or coalition with Labour where they won the most seats. Nick Clegg wasn't able to repeat his great 1st debate performance and David Cameron did so well in the 3rd debate that I decided right there to go back long on the Tories for a majority.

I also have a little bit going long on Charlie Crist in the FL Senate Race. I'm not exactly sure he can win, but Crist currently leads Rubio in the most recent poll of the now three way race in Florida. November is going to be very interesting in my home state. I think Rubio is a little over valued at the moment trading around 50%-55%. He should definitely be the favorite considering he should have organizational advantage now that he has won the Republican primary but Charlie Crist should not be dismissed so easily. He is the Governor and there does appear to be a section of the electorate that would be willing to vote for him.

Hopefully for next weekend, I'll be able to bet and post on Iron Man 2 but that is a big if at this point.

Lib Dems need 37%-38% for Nick Clegg to Gain Plurality

Yesterday, I explored some election scenarios in the U.K and found out that there is significant chance that the Liberal Democrats can beat Labour in seats if they lose enough support. If the Lib Dems have more seats than Labour, Nick Clegg could possibly become Prime Minister through a Lib-Lab coalition. Today, I analyze that scenario more in depth.

An interesting thing to note about most election scenarios is that there is a finite number of them. I really doubt any party can get above 45%, I also think the floor for Labour support has to be around 20%-25% and it can almost never go below that number. Labour has been around so long that they have to have a hardcore base much like Bush did when his approval rating plummeted but never went below 30%-33%.

Once again, all the scenarios have votes for others constant at 10%. Hypothetical polling in green consists of Lib Dems beating Labour in seats and the polling in in yellow consists of the Lib Dems gaining a plurality of seats.



What's interesting is that we could see the Lib Dems have more seats than Labour with 36% of the vote and the Tories at 33%. As long as the Lib Dems have the highest percentage of the national vote, they could claim a mandate to lead the next government.

As the Lib Dems rise above 36%, they slowly squeeze out the possibility of a Conservative plurality in seats. This is because there simply isn't any more room for the Conservatives to grow. 36%-38% is the electabililty threshold that Nick Clegg needs to reach to truly convince the British public that the Lib Dems can win the election. Right now, he isn't too far away from that goal polling around 30%-33%. But as it stands right now, all he is doing is preventing the Tories from reaching the majority they so desperately want. With the added possibility that the U.K might still have Labour stay in power.

The key to a Lib Dem victory right now is too crush Labour immediately. Get them out of the equation. Make sure that a vote for the Lib Dems is not a vote for Labour. Because if that is the case, the Conservatives could retain the mantle of Change.

Multiple UK Election Scenarios

The 2nd debate on foreign policy is today and the Lib Dems are now feeling the heat from Conservatives. The Daily Telegraph, has published this story on Nick Clegg which shows that he received money from political donors into one of his personal accounts. This blog post from the Independent seems to think that it is not that big of a deal. Here are some graphs using a swing calculator to illustrate what I think are some highly likely scenarios for the future. 

Scenario A) Conservative Resurgence
David Cameron wins the foreign policy debate and is able to bounce back and keep the Lib Dems from rising above 30%. The Lib Dems continue lose votes to the Conservatives but continue to gain from a Labour party that shrinks to it's hardcore base.

What's unfortunate in this situation for the Lib Dems is that they never have more than 110 seats. The good news for the Conservatives is that they can get a plurality of seats with 34% and a majority with around 37%-38% of the vote. This might be the best path for a Conservative victory at this point. The Lib Dem surge has stabilized by around 30%. Labour is in 3rd but they are still relevant. Convince the electorate that they aren't even a factor anymore and are nothing but a lame duck government.

The Tories still have two big advantages over the Lib Dems, money and organization. Both can help propel David Cameron back to the lead after a surge in the polls.

Scenario B) Lib Dems come in 1st but Tories come in close 2nd
In this scenario the Lib Dems continue to rise in the polls but the Tories are able to separate themselves from Labour. The Tories continue to be competitive with the Lib Dems but ultimately come 2nd.

This scenario, which does give the Conservatives a plurality but never a majority can go two ways, if the Lib Dems are still 2nd in seats then I think David Cameron will form either a minority government or with a coalition government with the Lib Dems. If the Lib Dems win more seats than Labour, then I think a Lib-Lab coalition with Nick Clegg as Prime Minister could be in order. Gordon Brown seems open to the idea of a Lib-Lab alliance and the Lib Dems are most closely aligned ideologically with Labour than the Conservatives. This might also be favored by the public because it puts the party that got first in votes at the head of government.

Conclusion
Under these two scenarios the chances of hung parliament are great. Both the Lib Dems and the Conservatives have to beat the other two handedly in order to win an outright majority. The Conservatives less so than the Lib Dems.

If Nick Clegg wants to become Prime Minister even as the head of a coalition, he will have to beat both parties. David Cameron can probably do it by coming in a close 2nd with Labour still on life support. Ultimately the path to victory is a lot easier for the Conservatives than the Lib Dems but this all depends on Labour doing very poorly.

Why Lib Dems Face Uphill Battle

Here is a little chart I made showing the unfairness of the British electoral system in favor of the Labour party. This chart was made using a Universal Swing Calculator.

In this chart the Others category are kept constant at 10% and the spread between Labour and the Conservatives is kept constant at 5%.


What's amazing is that as long as Labour stays within 5% of the Conservatives, the Lib Dem surge will do nothing to prevent a Labour plurality in seats until they hit 37%. The key for the Conservatives is to not lose any more votes to the Lib Dems and maintain a lead over Labour. Tomorrow, I'll go over some other election scenarios.

Light Posting in the Near Future

It's getting to that part of the semester where I have to focus on finals. I will not be able to post as often these next two to three weeks.

The election in Britain is getting a lot action now and I can understand why no one thinks the Liberal Democrats can win a majority. For a candidate who is very much like President Obama, his campaign is nothing compared to the organizational behemoth that crushed McCain/Palin. This isn't really his fault, no one gave him a chance a month ago. He is having his Iowa moment 17 days before the national election. Obama had his almost a year before the election, and then had one of the two major parties in the United States to run a campaign.

The Tories might be a bargain right now at 33% to gain a majority if they can bounce back to previous levels, but I don't know how they can recover. Lately, I have been reading Reminiscences of a Stock Operator. It has some interesting insight on trading and some of it can be applied to politics as well.

prices, like everything else, move along the line of least resistance. They will do whatever comes easiest, therefore they will go up if there is less resistance to an advance than to a decline; and vice versa.

Is a Liberal Democrat surge more likely than a Conservative one? From the looks of things, Labour seems finished, they seem the most likely to decline. Their support could swing over to the Liberal Democrats as they are the most ideologically similar but that works both ways.

The last debate served as the catalyst for the last Liberal Democrat surge. With two debates to go, one on foreign policy and one on the economy. Another surge could be possible. Both for Conservatives and the Liberal Democrats. But I got to say, I really feel the Lib Dems might be on the verge of something amazing here.

Forget the Tories, I'm Betting on the Lib Dems

Well, my analysis of the the U.K Election and the Conservatives winning rested on a single premise, that the 1st U.K debate would not fundamentally change the election. I was wrong, it has. Nick Clegg, the leader of the Liberal Democrat party won the first debate and has shaken up the entire election. The Labour party is now arguably in 3rd place with the Liberal Democrats in 2nd and the Conservatives still in 1st. All basically within the margin of error.

It seems that David Cameron and the Conservatives were right in picking the Change message but were wrong in assuming that the electorate would see them as the party that represents that message.

Pollster	Date	Conservatives	Liberal Democrats	Labour
YouGov	4/14/2010	41%	18%	32%
YouGov	4/15/2010	37%	22%	31%
ICM	4/15/2010	34%	27%	29%
ComRes	4/16/2010	35%	24%	28%
YouGov	4/16/2010	33%	30%	28%
ComRes	4/17/2010	31%	29%	27%
BPIX	4/17/2010	31%	32%	28%

The Liberal Democrats seem to be taking more voters from the Conservatives than Labour, the Liberal Democrats are taking votes from both parties as they continue to attack each other. Voters seem to be disinterested in both parties and do not like David Cameron. The only thing going for David Cameron is that he is not Gordon Brown.

The 1st debate helped establish Nick Clegg as an equal candidate against David Cameron and Gordon Brown. An alternative to the status quo of just the Labour Party against the Conservative Party. With his recent rise in the polls, a vote for the Liberal Democrats might not feel wasted, which is an important hurdle for any candidate. Now voters know that there indeed might be an alternative that has a chance of winning. Here is an interesting analysis of the debate by pollster Frank Luntz.

Nick Clegg also has the advantage of being fresh on the political scene and hasn’t been stereotyped as much as the other candidates. Labour has known for a long time that David Cameron was their main opposition and has done all the dirty work that the Liberal Democrats need to hurt the alternative candidate and appear squeaky clean at the same time.

Right now, if the polling remains the same until the election, I have no idea what will happen. Apparently, somehow Labour could win the most seats if it comes in a close 3rd in votes and Liberal Democrats might still remain in a distant 3rd in number of seats. It’s everything or bust for the Liberal Democrats. According to a swing calculator I found, they would need around 41% of the vote to win a majority in Parliament. I assumed the Conservatives would come in 2nd with 27%, Labour in 3rd with 22% and votes for other at 10%.

I think there is a significant chance the Nick Clegg and the Liberal Democrats can keep this up and break into the 40%+ range that the Conservatives were reaching less then a week ago in the polls. There are two more debates to go and Nick Clegg was the clear winner of the 1st one. Can he keepup the “Big Mo?” Soon we shall see.

On Intrade, I’ve dumped all my stock on the Conservatives and I’m going long on the Liberal Democrats. Both to win the election and win a majority. I’ve also gone a little long on Labour winning the election by winning the most seats and being invited by the Queen to form a minority government. The outcome I think is most likely if there is a hung parliament. But honestly I’m still trying to figure out how this entire election will play out. Somehow the Brits have managed to make an electoral system more complicated then the electoral college.

Box Office Predictions – Kick Ass and Death at a Funeral

No Bets this weekend. 

Movie	Opening Weekend Prediction
Kick Ass	$29.02 Million
Death at a Funeral	$23.54 Million

The U.K Election Debates

Today, we will have the first televised debate in the history of the U.K parliamentary election. Prime Minister Gordon Brown will be facing against Conservative candidate David Cameron and the Liberal Democrat candidate Nick Clegg.

There will be two more debates before the election and I highly doubt any of them becomes a significant game changer. Brown and Cameron are pretty good debaters thanks to Prime Minister's questions. As long as one of them doesn't screw up royally, the election will probably continue to proceed with a Tory lead in the polls. The Tories have been polling around 6%-9% better than Labour but simply beating them will not guarantee a majority in parliament. The Tories will have to do better than expected in the marginal seats.

Despite some of the news that Labour has been polling better recently. It was probably just a temporary bounce thanks to the launch of their manifesto, polling has returned to previous levels thanks to the bounce from the launching of the Conservative manifesto.

Considering how long the Tories have been in the lead in the polls and the current economic condition of Britain, I'm betting the Conservatives will hold on to their lead and eventually win a majority. There is still plenty of time left for the political environment to completely change. It might even happen tonight. But by the way the election seems to be proceeding, David Cameron will be the new Prime Minister of the U.K.

Intrade currently gives the chances for a Tory majority at 58%. Volume is still a little low but as the election gets closer, I think we could see some significant volume.

Box Office Analysis – Date Night

I’m taking a break from betting on the movies. This is starting to become really frustrating. Every way I seem to bet, it seems to go the other way. I’ll continue to post predictions and monitor my progress but unless I think I am getting a lock, I am probably not going to bet anytime soon. Luckily, I’ll have the U.K election to monitor and distract myself for a while.

Movie	Prediction	Actual	Absolute (%) Difference
Date Night	$32.31 Million	$25,207,599	28.18%

Box Office Predictions & Bets – Date Night

With no other Opening Weekend competition, Date Night with Steve Carrel and Tina Fey seem poised to break $30 Million for this weekend. On Intertops, I bet on the $29-$35 Million option for +150 American Odds. Let’s hope this movie comes in line with expectations. 

Movie	Prediction
Date Night	$32.31 Million