One week to go--posted by Tony Garcia on 10/31/2006
I have heard about polls trending towards the GOP. One reason I think polls are worthless is I have yet to talk to someone that is actually honest with the pollsters. I heard a statistic yesterday that 35% of people do not participate in polls. The growing number of cell phones replacing home phones AND the growing Do-Not-Call lists also make polls less worthwhile.
So, look instead to where people are putting their money and you may have a better pulse on the trends.
What is the market saying with one week left?
Perhaps this table will help explain the percentages from the market in relation to a football point spread. (Conversions are estimated using Dakota Gold's Conversion chart and TradeSports Converter.)
Now, the contracts.
The GOP holding the US House: 29.7%.
The GOP holding the US Senate: 68.2%.
Democrate US House Pickups (listed with 1/2 seats to avoid 'push')...
1/2 seats: 98.8%
4 1/2 seats: 94.8%
9 1/2 seats: 89.9%
14 1/2 seats: 74.0% (needed for Democrat majority)
19 1/2 seats: 63.8%
24 1/2 seats: 38.5%
29 1/2 seats: 29.5%
GOP House, GOP Senate: 25.0%
DEM House, GOP Senate: 46.0%
GOP House, DEM Senate: 6.0%
DEM House, DEM Senate: 25.0%
Hatch win: 74.8%
Pawlenty win: 33.0%
Other win: 2.0%
MN US Senate...
Klobuchar win: 94%
Kennedy win: 8.8%
Other win: 0.1%
MN 6th Cong Dist...(very little volume or interest, therefore amounts are not good indicators)
Bachmann win: 40.0%
Wetterling win: 40.0%
Binkowski win: 0.1%
********** UPDATE ********** (11/1/06)
After taking a quick look at the prices I noticed something very discouraging on the Kennedy contract. If you think Klobuchar is going to win you would buy the Klobuchar contract. However, the prices offered are at 99.8% and 99.9%. These are generally placed to catch typos...people who want to SELL at near 100% but accidentally click the BUY button. This is generally seen on contracts where there is noone willing to put their money against the contract (intentionally).
The same is true on the other side of the spectrum. The "Kennedy Wins" contract is seeing the same behavior in offers. If you think the Kennedy contract will fail then you would sell it. The prices offered are at 4.1% and 4.0%. Same thing as above except the prices are a little further away from 0.0% generally because of number of investors in long shots.
[Explanation: If you wanted to bet on this long shot coming through you would simply buy at 4 cents (plus fees) per contract and if it comes through you earn $10 per contract. That is nearly a 250-fold upswing and nothing is tied up in your account. On the 'winner' contract you would sell at $9.99 per contract getting that money in your account. But since the risk is you having to buy it again at $10 if you are wrong the full $10 per contract is frozen until the contract is resolved. You would only lose 1 cent per contract, but until conclusion the whole $10 is frozen. This is generally too inconvenient for the long-shot investor. Hence, the 'losing' contract floors are generally further from 0% than the 'winning' contract ceilings are from 100%.]
All in all...the market is drawing a ever-darkening picture for Kennedy.