ONs New York attorney general Letitia James announced Tuesday that an investigation has substantiated allegations of sexual harassment against Governor Andrew Cuomo and has profoundly affected markets.
Not on Wall Street, mind you, but online at forward-looking exchanges – like PredictIt, where US adults can invest or buy stocks in the future prospects of elected officials, political candidates and legislative measures.
While legalized sports betting has increased in the United States, betting on elections and other political events is prohibited in regulated jurisdictions. However, PredictIt works as an experiment with permission from the US Commodity Futures Trading Commission.
It is a research project from Victoria University in New Zealand. The anonymous data generated by PredictIt vendors is used worldwide in studies in areas such as microeconomics, political science, computer science, and game theory.
By 11 a.m. ET Tuesday, PredictIt retailers saw Cuomo as someone who faced a significant re-election challenge for the next year, but still seemed safe from resigning or impeachment despite facing many scandals.
That changed pretty suddenly, according to PredictIt Public Relations Director Lindsey Singer.
In a matter of moments, the stocks that Cuomo would stay in office at the end of the year rose from 88 cents to 51 cents. They would continue to fall later in the day after the governor released his response and requested his resignation or removal from office by state and national officials.
“It was interesting that the dealers knew there was this press conference. Sometimes it causes dramatic movements, ”Singer told The Center Square on Thursday. “But in this case, James mentioned the bottom line of the investigation as violating state and federal laws, and then we saw this dramatic decline in the market.”
The stock closed at 34 cents on Tuesday and fell again to 27 cents on Wednesday. They were trading at 25 cents on Wednesday afternoon. Conversely, stocks that Cuomo will not be in office are currently available for 76 cents per share.
When a market is open, traders can buy stocks, change their position or sell their share at any time, provided a seller or buyer is available. When the market closes, those who have a stake in a correct result will receive $ 1 per share. Each market or question is limited to 5,000 traders. Traders are tied to an investment limit of $ 850 in each market.
In addition to the year-end question, PredictIt currently has three other futures markets associated with Governor Cuomo. Traders can take action if they step down by September 1st, whether to be indicted by September 1st, and which candidate will win the Democratic primary next year.
On the latter issue, the trade had Cuomo as an easy favorite among other potential candidates. His shares traded at 42 cents each through Tuesday morning, and shares in James, who has not announced a run but was rumored to be a potential candidate, were about 10 cents cheaper.
But that too changed during the press conference when the traders made James a favorite, with Lt. Gov. Kathy Hochul was second choice and Cuomo slipped to third. The governor’s shares have fallen from 42 cents to 16 cents and have continued to fall as they go on sale for nine cents each on Wednesday.
James’ shares are 42 cents and Hochul 30 cents.
Singer told The Center Square that trade is nowhere near as strong as it was in last year’s presidential election. Still, thanks in part to Cuomo research and the upcoming California recall election, 156 markets are available to trade, which is a good number for an off-year, according to Singer.
More markets will be available as the 2022 elections draw near, she added.
While state-licensed sports betting cannot be active in the US, there is political betting in other parts of the world. These include the UK and offshore operators based in the Caribbean and Latin America, and these sports bets offer odds on US politics.
Paul Krishnamurty, an England-based betting advisor for operators like Betfair and BetOnline.ag, told The Center Square on Thursday that Cuomo’s odds for staying in office are trending the same trend as prices on PredictIt.
On Wednesday, BetOnline.ag posted odds of 1-2 that Cuomo would leave office before the end of the year. Krishnamurty said those odds were 1-7 on Thursday, meaning that a $ 700 bet would produce a profit of $ 100. At the same time, the chances of Cuomo remaining in office have been extended from 3-2 on Wednesday to 4-1.
Krishnamurty said more people are betting that Cuomo will stay, but he said it is likely because bettors find the odds attractive.
Similarly, BetOnline has James as their favorite, who is next year’s Democratic nominee, with odds of 4-7, meaning that a bet of $ 175 would bring in a profit of $ 100. These odds also correspond to an implicit probability of 63.6%.
Hochul is the second choice with 11-4, Cuomo third with 10-1.
Original location: Cuomos futures are hot for predictive exchanges