Features

Betting on politics: when to sit on your hands

It's tempting to place bets on big political events, says Matthew Partridge. But sometimes the odds just aren't good enough.

936-leave-634
Sometimes it's better to watch from the sidelines

The market on whether Britain will leave the European Union on29 March is currently Betfair's biggest, with £2.9m already wagered. Until the end of lastyear punters were predicting that we would leave as planned, but Prime Minister Theresa May's suggestion that MPs will get an opportunity to vote on whether to extend Article 50 has meant that the chances of a 29 March exit have drifted out even further to 6.2 (16.1%).

By contrast, the odds of the UK not leaving on the expected date are now as tight as 1.18 (84.7%). It's clear that the prime minister facesan uphill struggle to get her deal through Parliament, and she may have to get a short-term extension anyway in order to get through the huge amount of additional legislation that needs to be passed.

However, there is always a chance that she could win enough concessions to allow the ERG group of Brexiteers and the DUP to back her and there are a few opposition MPs who are expected to back her, too. It's important to remember that just before polls closed the betting markets were similarly certain of a Remain victory.

To be clear, I think that May's deal will indeed be voted down, and the Article 50 deadline extended. However, I don't think the odds are attractive enough to justify abet either way. It's always tempting to want to bet on a big event, but if you want to be a successful bettor, then sometimes you have to sit on your hands and look elsewhere.

Recommended

How the fear of death affects our investment processes
Investment strategy

How the fear of death affects our investment processes

Many of our investment decisions are driven by one simple fact: the knowledge that, one day, we will be dead. Here, in an extract from his new book, J…
2 Jan 2020
The good investments of the 2010s – and the bad
Stockmarkets

The good investments of the 2010s – and the bad

John Stepek takes a look back on which investments did well and which did badly in the decade that’s about to come to an end.
26 Dec 2019
How long can the good times roll?
Economy

How long can the good times roll?

Despite all the doom and gloom that has dominated our headlines for most of 2019, Britain and most of the rest of the developing world is currently en…
19 Dec 2019
Beyond the Brexit talk, the British economy isn’t doing too badly
Economy

Beyond the Brexit talk, the British economy isn’t doing too badly

The political Brexit pantomime aside, Britain is in pretty good shape. With near-record employment, strong wage growth and modest inflation, there is …
17 Oct 2019

Most Popular

Oil producers are back at their Covid-19 lows – is it time to buy?
Oil

Oil producers are back at their Covid-19 lows – is it time to buy?

With demand for oil hammered by Covid-19 and talk of “peak oil demand”, there are lots of good reasons to be bearish on oil producers. So, asks John S…
22 Sep 2020
The rising dollar is proving bad news for most other assets – will it last?
Investment strategy

The rising dollar is proving bad news for most other assets – will it last?

Precious metals, stocks and pretty much every other asset has taken a tumble as the US dollar strengthens. Dominic Frisby looks at how long this trend…
23 Sep 2020
Why you should stuff your end-of-pandemic portfolio with Chinese stocks
China stockmarkets

Why you should stuff your end-of-pandemic portfolio with Chinese stocks

For an end-of-pandemic portfolio, you need assets that can cope with today’s volatility. And that, says Merryn Somerset Webb, means Chinese stocks.
14 Sep 2020