Two new bets, plus trading tips: How caution and hedging make for good strategy.

Two new bets, plus trading tips: How caution and hedging make for good strategy.

On this huge day in the US election cycle, I make absolutely no apology for keeping stakes small and literally hedging my bets. Anything less would be irresponsible, given the treacherous difficulty in predicting this New Hampshire Primary. The Republican side at least – where the interesting betting lies. I’m quite sure that the market is correct to make Bernie Sanders a 97% chance – the effects of which I’ll deal with shortly.

We have one bet on the Republican race, which I’ve all but given up on already. From carrying great momentum away from Iowa, Marco Rubio may have blown everything in one debate. The problem with being a candidate whose reputation was built in the media – driven by image, fluency and therefore perceived electability – is that it can all disintegrate so quickly. What the media creates, the media can destroy.

In being so brutally, verbally mauled by Chris Christie, the Rubio brand became everything his detractors claimed. A lightweight, inexperienced, opportunistic career politician who repeats the same memorised lines on a loop. See this epic series of tweets from the wise Republican commentator David Frum.

Rubio can of course come back, but it is too late for New Hampshire and our four unit bet, and he is a bit damaged ahead of the longer race. My feeling is the likeliest threat to Donald Trump is John Kasich, for whom second or better would take his challenge up several gears and block a path for Rubio to sew up the establishment vote. A bunched finish would also put paid to Jeb Bush quitting any time soon – something Rubio needs urgently.

So far as the bigger picture is concerned, note that we’ve got a substantial risk-free position on both men. As we have on my main pick Ted Cruz, about whom we’ve already secured a small profit.

Certainly in the cases of Cruz and Rubio, laying back earlier has paid dividends as both have drifted since. In both cases, my analysis was hit by a sudden, unexpected development. Sarah Palin’s endorsement of Donald Trump freaked me, putting what seemed an easy win Iowa in jeopardy. When his odds drifted right out before eventually upsetting the odds there, at least I was covered .

Rubio’s disaster was also unforeseen, but matters not because we’ve covered the stake. Likewise. If Kasich bombs tonight and quits the race, there will be no damage done.

The great thing is that we are now free to go back in again, which is what I’m doing on Cruz. I am much more confident now about him than when laying at 6.0, yet he’s actually a bigger price at 8.0.

In my view, Cruz is the ultimate benficiary of Rubio’s woes. His biggest long-term rival is damaged, and the establishment lane continue to carve each other up. Cruz has no expectations in New Hampshire, yet it isn’t beyond the realms of possibility that he beats the establishment quartet.

His time comes in a few weeks when the race travels South, for Super Tuesday. My long-range prediction that Cruz would lead after that is on course.

I remain a huge sceptic of Donald Trump and am confident that if it comes down to the pair of them, Cruz wins. Indeed I believe Trump will struggle to win any 2 or 3 man races once the field winnows.

So I’ve just gone in again on Cruz at 8.0. I feel certain these odds will be shorter further down the track, and he’s now a massive winner for the book, securing nearly 400 units profit – leaving plenty to cash in later, if his odds indeed shorten.

The same plan applies to the Democrat race. Having taken a small 6 unit loss on Clinton, we are reliant on the  195 unit risk-free position on Sanders becoming president. That was secured by laying our stake back at 11, but he’s now drifted to 14, for reasons that totally escape me.

Sanders has momentum after a good Iowa result, and the money to stay in this race. I don’t believe he’ll win the nomination but odds of 5.5 are about right. If so, as before, his odds for the presidency are too big, as explained when having the initial bet. Therefore, as advised on Twitter yesterday, I’ve gone in again.

I would price Sanders at about 10, and expect him to reach that after New Hampshire. Watch out then for a swift cover bet, or cash out. That could be within a few days, as might the Cruz bet.

I appreciate this is a complex trading plan. Feel free to post any questions or send a message on Twitter to @paulmotty.

Finally, for the record, my exact prediction for New Hampshire:

GOP – Trump 24%, Kasich 20%, Cruz 15%, Bush 14%, Rubio 14%, Christie 8%, Fiorina 3%, Carson 2%.

DEM – Sanders 58, Clinton 42.


One response to “Two new bets, plus trading tips: How caution and hedging make for good strategy.”

  1. Great prediction better than mine as I had Cruz and Rubio reversed for 3rdand 5th and I’ve lived all over New England for 63 yrs and follow politics religiously . Any thoughts on South Carolina outcome yet ? Understanding Trump ( I guess there is a similar nationalist in France ) involves seeing the massive free publicity he gets from the 3 political TV stations every single day as he just calls in and is instantly on air nationwide . His availability is unprecedented turning this election cycle into his specialty a reality TV show . CNN , Fox .and MSNBC are relatively docile as they want him back for ratings . Great site I plan to learn a lot about political gambling here . Mark

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