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Betting on politics: deal or no deal

Matthew Partridge looks at the bookies' odds on the UK leaving the EU with no deal.

Nigel Farage © Leon Neal/Getty Images

It almost seems as if there have been more Brexit-related twists and turns in the last month than there have been in the entire period since the June 2016 referendum. Nothing illustrates this better than the perceived chance of a no-deal Brexit. Just a few weeks ago, many people believed that it was extremely likely. Now, thanks to the passage of the Benn bill through Parliament, instructing the government to ask for an extension to Article 50 unless a deal acceptable to Parliament can be passed through the House of Commons, it looks very unlikely.

These shifting perceptions have been reflected in Betfair's market on a no-deal scenario. At one point the implied chances of a no-deal Brexit were nearly 50%. They then plunged to a low of around 15%. With a total of £1.65m now matched on the outcome, punters clearly think that the UK leaving the EU without a deal is very unlikely, but still not impossible, and you can get 5.3 (18.9%) on a no-deal Brexit and 1.23 (81.3%) against. Nigel Farage no doubt has other ideas.

The lesson of the last three and a half years is that you can never, ever, rule anything out, but I think that the chances of a no-deal Brexit this year are less than 5%. So I'd advise you to take Betfair's 1.23 against the possibility of no-deal Brexit in 2019. As the rules of the bet make clear, this bet pays off if Britain fails to leave the EU before the end of the year or if a Withdrawal Agreement is agreed (and ratified) before Britain leaves.

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