Time to take the risk out of GOP positions and guarantee a small profit on Cruz
In a long election with many twists and turns – plenty of which have already occured before the primaries have even started – the key to making money is timing. As candidates rise and fall, we must try to buy and sell their ratings at the opportune moment – trading their odds like a stock portfolio.
That is why, given the impact of Sarah Palin’s dramatic, headline-grabbing endorsement of Donald Trump, this is a prudent moment to be cashing out *some* of our substantial position on Ted Cruz for the Republican Nomination. I actually tweeted this cover position immediately after her speech.
New #Election2016 bet: Lay Ted Cruz 25 units @ 6 for GOP nomination. Still leaves big profit, but Palin endorsing Trump could be gamechanger
— Political Gambler (@paulmotty) January 19, 2016
The two bets placed earlier yield a return of 400 units for an outlay of just 15 units. So by laying (or selling back) 25 units at odds of 6, we are guaranteed ten units profit on the bet, while reducing the potential return to 250 units. See the equation below.
This does not mean I’ve lost faith in the bet. It is a recognition that an unpredictable variable has just entered the equation. Tomorrow, I’ll be writing a new piece weighing the Palin effect. Given the uncertainty – I am nowhere near as confident about my long-range prediction, that Cruz will win Iowa or the early Southern states now – it would be unprofessional to carry risk and take no profit out of an excellent position.