Before we dig into this fascinating story, I have an admission to make.
Unlike some who are also hooked on politics like yours truly, I generally have little use for political polls -- including hyperbolizing about every new poll that comes out -- particularly when they're close, as is the case in the 2024 presidential election, which is a mere four days away as I write. The reality is that both Donald Trump and Kamala Harris have legitimate paths to the magic number: 270 electoral votes.
The above said, I am interested in the betting odds as the election nears.
I'm not talking about your next-door neighbor casually betting 10 or 20 bucks on the candidate he or she thinks will (wants to) win; I'm talking about serious, big-bucks bettors. Reason being, the latter has less or no political interest, with respect to betting, and more interest in making money.
In this case, I'm talking about someone betting -- and making or losing -- serious money. To the tune of $30 million.
A self-described French trader said he bet more than $30 million on the election after carefully analyzing multiple factors. Moreover, the man, who called himself Théo, said during a Zoom call with a reporter from The Wall Street Journal earlier this week, said: “I have absolutely no political agenda."
Théo also told the Journal what many of us suspect: “I know a lot of Americans who would vote for Trump without telling you that."
Here's more:
Théo’s huge wagers on Polymarket—a prediction market that isn’t open to Americans—drew broad attention last month after the Journal reported that four accounts on the platform had been systematically purchasing wagers on a Trump victory. The bets lifted Trump’s odds of beating Vice President Kamala Harris, as shown on Polymarket. Blockchain data showed that the accounts were all funded by the same crypto exchange, fueling debate about the motives of the “Trump whale” behind them.
Last week, New York-based Polymarket said it had contacted the Trump whale as part of an investigation into the wagers. The company described the person behind the bets as a French national with extensive trading experience and a financial-services background. “Based on the investigation, we understand that this individual is taking a directional position based on personal views of the election,” Polymarket said in a statement.
The details in Polymarket’s statement lined up with how Théo described himself. He confirmed that he had spoken to a member of Polymarket’s legal and compliance team.
As referenced in the above block quote, the Journal reported on October 18 that a "mystery $30 million wave of pro-Trump had moved the popular prediction market":
Over the past two weeks, the chances of a Trump victory in the November election have surged on Polymarket, a crypto-based prediction market. Its bettors were giving Trump a 60% chance of winning on Friday, while Harris’s chances were 40%. The candidates were in a dead heat at the start of October.
Trump’s gains on Polymarket have cheered his supporters, and they have been followed by the odds shifting in Trump’s favor in other betting markets. Elon Musk flagged Trump’s growing lead on Polymarket to his 200 million X followers on Oct. 6, praising the concept of betting markets. “More accurate than polls, as actual money is on the line,” Musk posted.
Whether or not Théo's $30 million moved the betting market odds is irrelevant in my mind.
What is relevant is the fact that this guy has apparently done enough research -- looking a multiple factors, I suspect -- to plop down 30 million bucks on a Trump win. Sure, the guy could be a multimillionaire, but 30 million dollars is still 30 millions dollars.
Why Are Betting Odds So Telling?
While more that $500 million was bet on the 2020 election, the number has exploded in 2024. As of October 25, more than $2.3 billion has been bet on Polymarket alone, which raises a serious question. Why do betting odds reflect actual probability?
Maxim Lott, founder of ElectionBettingOdds.com, explained to the Washington Examiner why betting odds are more predictive than the polls and revealed the “turning point” that jump-started former President Donald Trump’s rise in the election odds and polling.
“The betting odds are more reliable because people have to put their money where their mouths are,” Lott said. “That makes most people think twice, and to be more careful, before they weigh in about who will actually win.”
Having tracked hundreds of races since 2015, Lott affirmed “the betting odds have a great track record.” He explained that “specifically, candidates who were given a certain percent chance of winning actually won approximately that percentage of the time. For example ... candidates who were given a 70-80% chance actually won about 75% of the time.”
The analytical part of me buys the above. It's also suspicious of tight polls -- particularly national presidential election polls -- that I often view as largely popularity contests at any point in time.
One Glaring Exception
Donald Trump shocked the political world in 2016 when he beat Hillary Clinton, who remains bitter to this day. Trump also shocked the betting markets. Lot explained:
The bettors gave Trump a 20% chance on election morning, while the New York Times gave him 15%, the Daily Kos gave him 8%, the Huffington Post gave him just 2%, and Princeton Election Consortium gave him less than 1%.
Why, and how?
The answer in part goes back to what Théo told The Wall Street Journal. There still exists a substantial percentage of voters who won't publicly -- or even among friends and relatives -- admit that they support the former president.
Toss in voter turnout, which is always the key factor, and there you have it.
For that reason, and Théo's $30 million, I'll go with Trump for the win.
