Wednesday, 28 January 2015

Minor party (SNP) for major gain

Trust political predictions from academics to make money from the bookies (check the trading updates at bottom of blog)

(Original blog from 7/12/14)

The biggest change in voting intentions since the 2010 election is a collapse in overall support for three main political parties.  So called ‘Lib-Lab-Con’ support has leaked away to the SNP and Ukip. Voters are sceptical that traditional parties can handle key economic and immigration issues, they distrust the political establishment, and Labour has been scotched north of the border by the Independence Referendum.  In 2010, over 88% of UK voters supported the three main parties.  Today’s poll averages suggest just 71% will.  Some recovery of lost ground is predicted by leading academic studies, but only rising to around 76% of overall vote share.

The first implication is a ‘hung parliament’ becomes much more likely.  In other words, no party will be able to win the 326 seats required for an overall majority.  Such an outcome is now a 91% chance according to Dr Chris Henretty and colleagues.  Back in May 2010, bookies rated a hung parliament just a 36% chance (7/4).  Now the best price is 1/2 or a 67% probability (with  It’s still a good value bet.

The second implication is minor parties are going to receive more votes, principally Ukip and the SNP.  Whilst Dr Henretty forecasts Ukip will get 11% of UK votes come next May, their vote is spread far and wide, yielding just 3 seats to the Farage team.  The big seat gainers are likely to be the SNP.  Although forecast to win just 3.7% of the UK vote, a panel of polling experts deliver a universally bullish view on the SNP seat result: Baxter says 42; Bickerstaff, 48, Henretty 37 and Kellner, 45.

The spread betting firm, Sporting Index, predicts just 20-22 SNP seats, and this market should be bought at 22.  If they achieve just 30 of the 59 Scottish seats you will make 8 times your stake profit.  Alex Salmond’s recent decision to stand for the seat vacated by the Lib Dem Malcolm Bruce adds another seat to the total.  He is a 1/7 shot to win with Ladbrokes (88%), despite having to overturn a sizeable majority of 6,748.  But beware, if the SNP make no gains at all from their current total of 6 seats, you will lose (22-6) or 16 times your stake.

TRADING UPDATE (03/01/2015)....  SNP seat market currently trading at 29-31.  This means if you had taken the advice above to buy at 22 seats on 7th December 2014 - you could now close your bet before a vote is cast, and secure a 7 times your stake profit.  But remember, just like a share, spread betting prices on politics can go down as well as up.  It is a particularly volatile form of betting.   A less risky way of supporting SNP success is to bet that the SNP will be involved in any coalition, currently 13/2 with Hills.  Another tip!

TRADING UPDATE (21/01/2015)....  Hills have cut the price of the SNP being involved in any coalition to 11/2 fro 13/2.  SNP seats stand at 28-30 with Sporting Index.  Betfair forecast of Hung Parliament now 73%.  Steve Fisher forecast of Hung Parliament up to 79% from 61% at the beginning of January 2015.  Newsnight / Henretty and Co. forecast for Hung Parliament, currently 90%.  In short, all tips given above are currently returning profit. 

TRADING UPDATE (27/01/2015)....  SNP seats mid-point forecast from Sporting Index now 32.5 (see graph below for how minor party markets have moved since they opened in November 2014).

TRADING UPDATE (04/02/2015)....  Following Ashcroft Scottish constituency polling today - SNP seats now trading at 35-37 with Sporting Index. Those who took the advice of this site to buy SNP seats at 22 on 7th December 2014 can now close their bet for a 13 times their stake profit.

William Hill now make 'any coalition involving the SNP' a 9/2 chance.  Tipped here at 13/2 on 3/1/2015.


A final tip (05/03/2015) -  Purchase 'turnout' (i.e. Buy!) at 69.6% with Sporting Index - see these two articles:

1) - and

2) - 

Think about:

  • Scotland's new zeal for political engagement
  • Ukip bringing back previous abstainers
  • The closeness of the race
  • A relatively large left / right policy differential between Miliband and Cameron
  • Sunny, warm conditions on polling day because of global warming...

All these factors may see turnout top 70%.

Albert Tapper (@mincer) is a former trader of political markets at the spread betting firm Sporting Index.  He now works on a leading academic project analysing the 2015 General Election, led by Dr Matthew Goodwin (University of  Nottingham).