Yahoo Finance’s Alexis Christoforous and Sarbjit Bakhshi, Smarkets Head of Political Markets, discuss betting markets amid election uncertainty.
ALEXIS CHRISTOFOROUS: And this election has thrown the betting markets into a tizzy. Biden now back as favored to win the election in online betting markets according to Smarkets Exchange. I want to bring in Sarbjit Bakhshi, head of Political Markets at @smarkets right now. And it looks like a total reversal of fortune here in just the past few hours, Sarbjit. Tell us the numbers. What are the odds now of a Biden White House?
SARBIJIT BAKHSHI: So, as you said, we've had Biden at 78% to become the president versus Trump at 21%. The numbers have been going crazy on our market overnight. Last 24 hours since I was last on Yahoo, we've had another $6 million traded on this market. It's absolutely phenomenal.
What we saw is that straight after Florida, straight after Texas going to Trump, our markets flipped over and gave Trump a chance at winning. And he went up to, I think, 80% in our market at 3:00 AM UK time, I think, 10:00 or 11:00 PM Eastern time. That was because his path to victory was so clear at that point because for Trump, he needs Texas. He needs Florida to become the victor in this election.
However, that's not to say that Joe Biden needs those same states. And I think what's been happening for the rest of the day is that as the states that Joe Biden really needs-- Wisconsin, Michigan, and Nevada, they're all showing a Biden lean. I mean, Wisconsin you've said has been called by AP. But Michigan is at 94%. Nevada's 86%. If he gets those three states, including Arizona, which has been called as well by AP, he's got 270 votes in the electoral college. And he will become the next president of the United States.
It's something that is obviously of matter to Trump. He's contesting these elections, especially how close they are. But it seems pretty clear that actually throughout the day, other people have been getting on the market, seeing the reality of the situation for Joe Biden, and trading that-- trading that Trump price down to where it stands now at 21%.
ALEXIS CHRISTOFOROUS: So people are also busy betting on whether or not Trump will concede the election. So what are your numbers telling you there?
SARBIJIT BAKHSHI: That was very interesting. Yesterday, we had a very hopeful message of the people believing that the 58% chance that he would concede. Today, it's gone down to 48% and that he won't concede to 55% obviously contingent on him losing the election. But it's now more likely than not that Donald Trump would not concede the election if he lost it.
ALEXIS CHRISTOFOROUS: What about when we're going to get some clarity here? Are people betting on when a winner will actually be declared? And what kind of a timeline are they betting on?
SARBIJIT BAKHSHI: So we have markets on where we had a market on being declared yesterday obviously didn't happen, today, and then next week. And I think it's tending now to more towards next week, as they realize the recount is not going to delay the process and a result coming in.
ALEXIS CHRISTOFOROUS: What about Senate races? Are you seeing any interest in betting on those races or whether or not the Senate will remain Republican?
SARBIJIT BAKHSHI: Yes, so going into this election, our markets are pretty clear that it was looking at a blue wave-- Democratic House, Democratic Senate. That's been changing overnight. Those surprise victories for the Republicans in the Senate have diminished their chances. We're now looking at a 78% chance that the Republicans are going to hold on to the Senate and the Democrats are going to be in the lower House.
Obviously, as your previous guest said, this is not an outcome that anyone was really expecting. It's going to have a big impact if Biden becomes the president and will really shape America going forward.
ALEXIS CHRISTOFOROUS: Have you seen any shift like this in past market data where, I mean, the shift just seemed to happen almost on a dime? And I'm wondering if you saw that happen with Wisconsin. Was that when you saw Arizona flip? When did that sort of moment, that shift happened in betting.
SARBIJIT BAKHSHI: So we're looking around about, I think, 10:00 to 12:00 PM Eastern time. That's when we saw the massive shifts across all our markets. But what's been amazing is that every time that you go to Smarkets.com and check those prices, they've changed again. These markets are the site of enormous debate between people who have different points of view about what the outcome will be. And they are putting on money after money to try to resolve what this will be.
And what's been interesting is that normally once you see one big swing, it's because the market's determined. Everyone knows what the result is. And they're moving towards that result. But we're seeing these things swing in and swing out, swing in and out all day and probably into the evening till we actually get the final results.
So I would say we've never seen anything like this event. This is our biggest single political market that we've ever had it's markets. I mean, 6 million traded simply on 24 hours is incredible. So, you know, I don't know where this is going to end. I don't know how many more millions are going to go on this. But clearly, it's captured the imagination of all our users in the UK. And we've had thousands and thousands of people come to the site to check out the information.