Brexit odds at bookies vs polls vs trade

[JackRab]

Why are the odds for Brexit so different at the bookies compared to the polls?

I mostly think the bookies are a better way of finding out the odds of political issues, because it's people actually putting money where there mouths are.

However, could this be the case with Brexit:

The payout for Brexit-vote is 2.8 (36% chance)... for Remain 1.55 (64%), while polls are 50:50..
Does this merely reflect the move in financial markets after the vote?

So, the move after a Brexit-vote will be significantly more than a Remain-vote... about 2x as much... 10% down vs 5% up?

From a trading/investing point of view this makes sense right? Or is it just getting late and I just need to go home and have a beer?

 

[OLdNoob]

In the polls 1 person 1 vote at the bookies size of bets dictates odds given, from what i've seen many low income votes are in the brexit camp, that might explain the disparity.

 

[barjon]

Rather like the Scottish referendum maybe people express their desire from their hearts (opinion poll) but then vote with the realities from their heads (bet)

 

[ffsear]

People keep taking about "fear" project fear this and project fear that...

Now whats the old saying in trading about fear?
“Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”



I think we'll stay IN and this is a buy.

 

[samfarrell]

People keep taking about "fear" project fear this and project fear that...

Now whats the old saying in trading about fear?
“Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”



I think we'll stay IN and this is a buy.

Load the boat so
4/6

 

[JSMITH07611]

well look at the main page at ig

https://www.ig.com/uk/brexit?icmp=brexit

and

https://www.ig.com/uk/welcome-page

Leave ahead in the latest IG/Survation poll

I don't know how they could write such rubbish when their own odds in the binary section are 64% chance of remaining

 

[Hoggums]

Well if you think the bookies are wrong surely it's an "investment" opportunity.

They are also probably weighting the odds towards how people so far have been betting.

 

[ffsear]

I think a buy of GBP/JPY could be the best value. Assuming the result is IN.

 

[tomorton]

Why are the odds for Brexit so different at the bookies compared to the polls?

I mostly think the bookies are a better way of finding out the odds of political issues, because it's people actually putting money where there mouths are.

However, could this be the case with Brexit:

The payout for Brexit-vote is 2.8 (36% chance)... for Remain 1.55 (64%), while polls are 50:50..
Does this merely reflect the move in financial markets after the vote?

So, the move after a Brexit-vote will be significantly more than a Remain-vote... about 2x as much... 10% down vs 5% up?

From a trading/investing point of view this makes sense right? Or is it just getting late and I just need to go home and have a beer?

Careful of extrapolating from bookies' odds to % of vote. Bookies don't base their odds on voter or punter head-count, they need just to make sure their payout to winners is less than their take from the losers.

 

[JackRab]

Careful of extrapolating from bookies' odds to % of vote. Bookies don't base their odds on voter or punter head-count, they need just to make sure their payout to winners is less than their take from the losers.

That's true for most bookies. I think betfair is run differently... they have 2-way markets where you can back and lay on both outcomes. They mostly take a profit% of punters. I find they always have the best odds compared to the back-only firms.

 

[JackRab]

Well if you think the bookies are wrong surely it's an "investment" opportunity.

They are also probably weighting the odds towards how people so far have been betting.

I don't think the bookies are wrong, I think polls are wrong most of the time... especially the further away the vote is.

 

[NVP]

Why are the odds for Brexit so different at the bookies compared to the polls?

I mostly think the bookies are a better way of finding out the odds of political issues, because it's people actually putting money where there mouths are.

However, could this be the case with Brexit:

The payout for Brexit-vote is 2.8 (36% chance)... for Remain 1.55 (64%), while polls are 50:50..
Does this merely reflect the move in financial markets after the vote?

So, the move after a Brexit-vote will be significantly more than a Remain-vote... about 2x as much... 10% down vs 5% up?

From a trading/investing point of view this makes sense right? Or is it just getting late and I just need to go home and have a beer?

Hey there

I grew up,in a family of bookmakers and spent my early / teenage years helping run the business....

Bookies odds have nothing to do with the general,consensus......they are to do with making money......by rounding the books and if necessary laying off

So the odds will reflect the gamblers historic bets with the organisation and the rates they are offering for bringing more bêts into the book.....

Nothing more nothing less

N

 

[JackRab]

Hey there

I grew up,in a family of bookmakers and spent my early / teenage years helping run the business....

Bookies odds have nothing to do with the general,consensus......they are to do with making money......by rounding the books and if necessary laying off

So the odds will reflect the gamblers historic bets with the organisation and the rates they are offering for bringing more bêts into the book.....

Nothing more nothing less

N

Normal bookies have a skewed price, which add up to only 90% or so right? That's how bookies normally keep their 'edge'. Then by skewing more, then trade out of any lob-sided open bets they have on their books.
Or am I wrong on this?

But if you look at Betfair, the actively traded bets are actually like a real market. By far the odds are fairer because of 2-way market. The sum actually adds up to 100%.

Doesn't Betfair allow external parties to provide bid/offers like real market makers? In that case, there are no conventional bookies, except the ones that may want to trade out of their own leftover position on bets through a site like Betfair which has more correct/fair odds.

There are a lot of bookmakers in Australia, and none have a two-way (back and lay) style betting market.... except Betfair.

 

[JackRab]

How about this scenario:

If the odds at betting firms would be 50:50 (more like the polls)... and you expect a bigger move in financial markets when the vote is "Leave" which most believe, hence the selloff of the last week... (say 10% down vs 5% up) there would be an arbitrage opportunity.
Because, you sell short and have a risk/reward of 5/10... and hedge buy betting on "Remain".

Say you short 100k and bet 7,5k on remain;

Result is Leave = +10k - 7.5k = 2.5k profit
Result is Remain = -5k + 7.5k = 2.5k profit...

So, the Remain bet at 50:50 would have a too high payout... So remain payout should go down, Leave payout up....

Could that be why odds sit at 65:35?