Outsiders look the value in search for an alternative to Fillon

Fuelled no doubt by the drama of 2016 and Marine Le Pen’s plausible candidacy, the French election was already shaping up to be a much bigger betting heat than usual before the Penelopegate scandal broke. Now, as I wrote earlier this week, we are looking at a potential re-run of the US election drama.

In truth, I’ve come late to this party. Having devoted all my focus in 2016 to the US and UK, I missed out on two massive gambles – on Francois Fillon and Emmanuel Macron – and only started building a position last week, in response to Penelopegate. Though I didn’t advise specific bets or stakes, hopefully some of you have followed my lead on Twitter to make something from the significant market fluctuations.


Through trading those four positions, I’ve built a nice, green book but am not taking a definitive position on anybody. That will come in due course. Right now, I would say Macron is the likeliest winner but an unknown quantity at short odds, in a tight, tactical race doesn’t make much appeal. I don’t think Le Pen will win but feel certain she will be in the final two. Neither the Conservative or Socialist candidates can be written off.

Instead of taking that view yet, the best betting angle concerns Fillon and whether he can keep the nomination. The headlines and polling numbers have been diabolical for the UMP candidate ever since the scandal broke. The questions will not disappear and he may now be fatally branded as at best part of the entitled political class or, worse, corrupt. According to a poll today, 68% want him to withdraw, including 59% of elderly voters – his core constituency.

That cycle of negativity explains his market weakness, out to 8.0 (12%) from 1.8 (56%) a fortnight ago. It also explains why Juppe has shortened from 550 at the time of my tweet, to just 10.0. Neither signal, however, is necessarily a reliable indicator.

As we saw repeatedly last year in the US election, the market loves speculation about replacement candidates. Those of us who spent all year glued to that market will never forget the crazy fluctuations in the odds of Bernie Sanders, Joe Biden, Mike Pence and Paul Ryan. Yet so far as we know, neither Clinton or Trump were ever in real danger of being replaced.

So on that reckoning, Fillon may well be under-estimated. More to the point, the likelihood of Juppe is surely overstated. He has repeatedly said he’s not interested and would not necessarily be a better pick. It would be hard to sell an elderly, defeated primary rival, with corruption allegations in his own background, replace a candidate over an unproven corruption scandal.

The same goes for Nicolas Sarkozy, who has shortened from 300 to around 40.0. The former president is deeply unpopular and could well fare even worse than a damaged Fillon. Surely it would be better to pick a fresh face?

I suspect the market is simply overstating the most recognisable UMP alternatives. If the party were to adopt this drastic course of action, there would surely be plausible alternatives. Yet the names being mentioned in the press are all much bigger than Juppe and Sarkozy.

Today’s survey listed five alternative candidates, whose current odds range from 100.0 to 1000.0. The names are consistent with other media speculation – see this RTL piece for example.

If as expected, the speculation persists over the next week or so, I reckon we’ll see a significant move on at least one of the following quintet – Francois Baroin, Xavier Bertrand, Laurent Wauquiez, Gerard Larcher and Valerie Pecresse.

In some cases, this may be pure speculation but their comments and press are worth following. Wauquiez, for example, gave a classic Frank Underwood response yesterday, acknowledging ‘doubts’ while pledging support. Larcher has made some notable criticisms too.

Due to the lack of liquidity on outsiders, I’m not going to advise specific stakes and prices but odds above 100 are worth considering on each of them. As always, feel free to ask any questions via Twitter.

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