One factor behind the excellent predictive record of political betting markets is that, whereas media coverage is driven by headline national polls, the serious gambler will analyse the race on a deeper level. The 2012 election was a classic case in point, with virtually every commentator declaring it ‘too close to call’ even on the night, on the basis of tight national polls. However the markets were strongly pro-Obama partly because, as I explained here in October 2012 for Betfair, his votes were better distributed, making victory in the electoral college extremely likely.

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