Spreadex UK General Election Update, 17th May 2017

There are only three weeks until the election and the Tories are still on track for a landslide victory, something supported by the behaviour of Spreadex’s clients in the past month.

First a bit of context. While spread-betting is an imperfect science when it comes to predicting the outcome of a result, Spreadex’s clients have an impressive track record for putting their money on the winning political horse. Back in 2015 – which feels like it belongs to a different era – clients were consistently buying Tory seats around the 300 mark despite polls suggesting that the country was in for its closest election in decades. There was a similar situation in the run-up to the 2016 US election; though there were roughly an equal number of bets supporting Clinton and Trump, all the big money was on the orange-faced Republican. In the last two years only Brexit proved to be an anomaly, with most clients backing Remain.

So far there is nothing to indicate a surprise this time around. The Conservatives’ election seats spread has steadily increased since the election was first announced, from 371-377 to 394-400. And while there has been a rise in Tory seat sellers as the spread crossed 400, the early support suggests this is less because clients think May will lose, and more that they believe the Conservatives majority will be closer to 140 than 150.

As for Labour, there are fairly similar levels of selling and buying around a spread of 158-164. When May first announced the election things were looking pretty terrible for Labour. However, since then Jeremy Corbyn and co. have found a solid seam of support, with a noticeable spike in buys as the party’s manifesto was leaked.

Interestingly it is not Labour or the Conservatives, but the Liberal Democrats, who have seen the most action. At a spread of 14.5-17.5 Tim Farron’s party has seen both the biggest bet stakes, and the most bet value, with the majority of clients thinking the pro-Europe choice will suffer despite arguably being the only real Brexit opposition.

Elsewhere it looks like the SNP are in for a rough June, as Spreadex clients are almost uniformly selling Nicola Sturgeon’s party at a spread of 43-46. There has been little interest in the Greens, at 1-2, while UKIP has seen a smattering of speculation, though at 0.1-1 most clients are betting on the far-right party ending up with no seats at all.