Silver’s model and most other lines of evidence indicate that the US presidential race is as close to a tossup as it gets. But, as of this writing, you can buy Harris contracts on Polymarket for 38 cents. The explanation for this apparent mispricing seems to be that, over the past few days, a single pro-Trump trader has poured tens of millions of dollars into the platform. “Domer”, the author of the linked tweet and Polymarket’s most successful trader to date, claims that this effect has depressed Harris’s contract price by around five cents, though I am unable to independently confirm this claim.
Strong upvote because I literally wanted to write a quick take saying the same thing and then forgot (and since then the price has moved down even more).
I don’t think the inefficiency is as large as in 2020, but like, I still think the overall theme is the same—the theme being that the vibes are on the R side. The polling errors in 2016 and 2020 just seemed to have traumatized everyone. So basically if you don’t think the vibes are tracking something real—or in other words, if you think the polling error in 2024 remains unpredictable / the underlying distribution is unbiased—then the market is mispriced and there’s a genuine exploit.
I think the burden of proof goes the other way? Like, the default wisdom for polling is that each polling error[1] is another sample from a distribution centered around 0. It’s not very surprising that it output a R bias twice in a row (even if we ignore the midterms and assume it was properly twice in a row). It’s only two samples! That happens all the time.
If you want a positive argument: pollsters will have attempted to correct mistakes, and if they knew that there would be an R/D bias this time, they’d adjust in the opposite way, hence the error must be unpredictable.
pollsters will have attempted to correct mistakes, and if they knew that there would be an R/D bias this time, they’d adjust in the opposite way, hence the error must be unpredictable.
Exactly. Silver has discussed this dynamic in some of his old FiveThirtyEight articles. The key is to appreciate that polling error is not an effect one can naively predict by looking at past data, because it is mediated by polling agencies’ attempts to correct it.
Silver’s model and most other lines of evidence indicate that the US presidential race is as close to a tossup as it gets. But, as of this writing, you can buy Harris contracts on Polymarket for 38 cents. The explanation for this apparent mispricing seems to be that, over the past few days, a single pro-Trump trader has poured tens of millions of dollars into the platform. “Domer”, the author of the linked tweet and Polymarket’s most successful trader to date, claims that this effect has depressed Harris’s contract price by around five cents, though I am unable to independently confirm this claim.
Strong upvote because I literally wanted to write a quick take saying the same thing and then forgot (and since then the price has moved down even more).
I don’t think the inefficiency is as large as in 2020, but like, I still think the overall theme is the same—the theme being that the vibes are on the R side. The polling errors in 2016 and 2020 just seemed to have traumatized everyone. So basically if you don’t think the vibes are tracking something real—or in other words, if you think the polling error in 2024 remains unpredictable / the underlying distribution is unbiased—then the market is mispriced and there’s a genuine exploit.
Is there a good reason to think that if polls have recently under-reported Republican votes?
I think the burden of proof goes the other way? Like, the default wisdom for polling is that each polling error[1] is another sample from a distribution centered around 0. It’s not very surprising that it output a R bias twice in a row (even if we ignore the midterms and assume it was properly twice in a row). It’s only two samples! That happens all the time.
If you want a positive argument: pollsters will have attempted to correct mistakes, and if they knew that there would be an R/D bias this time, they’d adjust in the opposite way, hence the error must be unpredictable.
That is, for a smart polling average; individual polls have predictable bias.
Exactly. Silver has discussed this dynamic in some of his old FiveThirtyEight articles. The key is to appreciate that polling error is not an effect one can naively predict by looking at past data, because it is mediated by polling agencies’ attempts to correct it.