Quanty election odds narrow, but not enough…

Final look at election odds before the election:

Australian Federal Election Odds

There have been some improvements for the Coalition overall. But not enough – if every single one of the 16 “Maybe” and “Toss-up” seat falls to the Coalition, they will only have 72 seats, with Labor on 75.  The Coalition then would also need to convert at least 3 of the seats where bettors currently give Labor a 67%+ chance of winning. Seems very unlikely.

As a reminder of the thought process behind the analysis:

I have a working theory that overall betting odds on elections are affected by what people wish would happen as much as what people think will happen. However, my theory is individual seat odds are less likely to be affected by the casual gambler and the betting odds are likely to be dominated by either (a) hardcore gamblers or (b) those with actual “on the ground” insight into what is happening – and both of these are groups I believe can offer insight into likely outcomes.

My next step is to categorise the seats into categories based on odds:

    • Very Likely = $1.17 or better, implying an 85% chance of victory
    • Likely = $1.18-$1.50, implying a 67%-85% chance of victory
    • Maybe = $1.5-1.8, implying a 55%-67% chance of victory
    • Toss-up = any worse odds

    This gives me a better feel for the likelihood of an election outcome – in the past, this methodology has been successful at picking winners or identifying that it was too close to call (for the Gillard hung parliament).  Basically I add up the likely and very likely’s and then look at how the remaining seats would need to fall.

  • Final thought – while the Warringah odds are close, given that Tony is a high-profile polarising figure, I’m guessing that Warringah is also affected by people betting for what they wish would happen – I just don’t know in which direction…

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Damien Klassen is Head of Investments at the Macrobusiness Fund, which is powered by Nucleus Wealth.

The information on this blog contains general information and does not take into account your personal objectives, financial situation or needs. Past performance is not an indication of future performance. Damien Klassen is an authorised representative of Nucleus Wealth Management, a Corporate Authorised Representative of Integrity Private Wealth Pty Ltd, AFSL 436298.

Comments

  1. A hung parliament and a feral Senate just as the economy’s wheels fall off. There’s so much to love in the poetic synchronicity of life, the universe and everything. (AUS $0.)42 by Christmas 2020?

  2. BoomToBustMEMBER

    Race to the bottom with both parties trying to loose the election while appearing to want to win.

    • Nope, they achingly want to win because power is what power-hungry people want, but they’re all so hopelessly corrupted and stupid they can’t connect with the voter, hence everything collapsing into the middle.

  3. Labor will win the House of Reps but it will be closer than expected. Morrison has had a good campaign. Shorten has offered a small target. It won’t be enough for the Libs.

    Incidentally, Labor’s policies are economically batshit insane when you actually read them.

  4. Aud now 0.68c, sinking like the titanic.
    Unemployment has gone up.
    And Jobs, real & even ‘nominal’ jobs have fallen.
    Roy Morgan April 2019:
    “Australian unemployment increased to 1.49 million in March (10.9% of the workforce) with an additional 1.32 million now under-employed as overall employment is down on a year ago. The latest data for the Roy Morgan employment series for March shows: The workforce, which comprises employed Australians and those who are unemployed and looking for work, increased by 65,000 to 13,649,000 on a year ago. However, despite the increasing workforce, now 216,000 fewer Australians were employed in March than a year ago, down to 12,158,000”

    Housing price collapse.
    Negative equity & debt bubble.

    And still the Migrant influx pours in.
    TR onshore up 5.6% in the last year.
    Now 2.561 million or 1 in 10 people a TR third world unskilled migrant guestworker on a visa allbi
    – 89% concentration in Sydney (1.3 million or 1 in 4 people) or Melbourne (1.01 million or 1 in 5 people).
    Plus 1.9 million third world unskilled migrant PR, 86% concentration in Sydney (0.9 million) & Melbourne (0.7 million).
    Plus another 1 or 2 million elderly migrant ‘parents’ to flood in on top.
    And neither major party gave Australians any choice in doing something about that.

  5. Interestingly when Whitlam and Hawke won, they found within a short period that the world had changed. Whitlam didnt change his agenda enough i response, Hawke did. If Shorten wins it looks quite possible he will face a similar test and we will see whether his ability to persuade, herd and lead are up to Hawke’s example. He doesnt have another currency to float but the big program of policies may need reprioritisation.

  6. Newsflash: MB’s forecasting skills as good in politics as they are in FX, commodity prices et al!