Brexit odds

As of 16:50 Eastern Standard Time.

As a public service, let’s translate these betting odds into plain English. If a bettor wagers £10 that a majority of voters in Britain will vote to leave the European Union (“leave”), odds of 6/1 implies that the bettor stands to make £70 total: his initial stake of £10, plus a huge profit of £60. (Notice the amounts here are stated in pounds since this is a British betting site, where gambling on political and sporting events is totally legal.) By contrast, if the bettor wagers £10 that a majority of the voters will vote to remain in the E.U. (“remain”), with odds of 1/7, the bettor will only receive £11.43: his initial stake of £10, plus a relatively miniscule profit £1.43. Notice what this particular betting market is telling us: “remain” is a safer bet than “leave.”

This entry was posted in Bayesian Reasoning, Current Affairs, Economics, Law, Politics, Probability. Bookmark the permalink.

3 Responses to Brexit odds

  1. CHCollins says:

    It seems to me that there was a lot of hand-wringing but not a lot of analysis as to why the “betting crowd” got the outcome wrong.

  2. CHCollins says:

    Not that this is related, but I was also surprised, listening to BBC World Service, that there is apparently some kind of news blackout in the UK on election-day reporting. On-air reporters were carefully crafting their words on the subject that day. I wonder if there is some kind of barrier in the UK to doing exit-polls etc.

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