Financial Trading Blog

UK General Election Update, 31st May 2017



With just over a week to go there have been some notable changes in Spreadex’s General Election spreads – though not enough, perhaps, to significantly alter the outcome.

The reaction to the Tory manifesto was, to put it mildly, not great. People jumped on the so-called ‘dementia tax’, forcing Theresa May to pull a spectacular U-turn, with the Prime Minister introducing an unspecified ‘absolute limit’ on lifetime care costs – an element of the Conservatives’ social care plan that was absent from the initial manifesto. Combined with the largely positive reception for Labour’s own policies, and Corbyn’s solid showing against Jeremy Paxman, this has caused a shift in the polls, with each new survey seeing the Tory’s lead shrink.


This in turn has fed into the Election Seats spreads, with the Tories falling from a peak of 394-401 to 364-370; for the first time the party’s spread is now lower than the 371-377 seen when the election was first announced. As for Labour, they’ve moved from 158-164 to 197-203 – a marked improvement, but one that still leaves them with far fewer seats than the 232 won in 2015.

In terms of the behaviour of Spreadex’s clients, there has been little material change to their trading patterns. There are still substantially more sellers of Tory seats than buyers, though this is arguably a comment on the size of the party’s prospective majority than the likelihood of them losing. This is idea is supported by the one-way traffic seen around the Overall Majority Binary and Most Seats Binary spreads, where clients are buying the Tories at 77.7-85.8 and selling Labour at 5.2-8.4 respectively. There has, however, been increased interest in the No Overall Majority fixed odds price, with people willing to take a punt at 5/1.

And what of the other parties? Well, despite struggling to get much media coverage the Lib Dems are still the focus of both the greatest number of, and chunkiest, bets from Spreadex’s clients, who have continued to sell at 12-15. There has also been a mild increase in buying SNP seats at 45-48, though not enough to change the Scottish party’s generally negative outlook.

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