Sunday, 13 April 2014

How far will the Lib Dems slide down the electoral razor blade?

With the Lib Dems polling 7% in two separate polls today, and with only just over a year to go until the general election, it seems like a good time to see how the bookies assess their chances of keeping the seats that they hold.  We have prices on every single Lib Dem seat, so we can do a complete analysis.  Here are the best prices on the Lib Dems listed by size of their majority (the table is based on UK Polling Report's magnificent work):
The nearest challenger is denoted by the colour of the majority.
But we can give a more informative table than that.  Let's organise the seats not by majority but by best price:
From this table, some things leap out.  First, the bookies are a lot less confident about the Lib Dem chances against serious Labour challengers than they are about their chances of holding on in two horse races against the Conservatives. The red has risen to the top of the table.
Secondly, there are 27 seats where the odds are between 2/1 and 1/2 that the Lib Dems will hold on - nearly half the total.  The bookies aren't very confident that they really know what is going on.
Thirdly, there are only 20 seats where the Lib Dems are rated by the bookies as odds against to keep their seats.  Even with the vagaries of First Past The Post, that seems optimistic if the Lib Dems stay in single figures.
Fourthly, there are some anomalies.  It is unclear why the Lib Dems are rated as short as 6/4 to hold on in East Dunbartonshire with a slender majority of 4.6% over Labour, while they are rated at 2/1 to hold on in Cardiff Central with a much healthier majority of 12.7% over Labour, especially as the Lib Dems appear to have lost ground particularly steeply in Scotland.  Some of the pricing is driven by sentiment: only punters' animus against Nick Clegg can explain why he is rated only 1/4 to hold onto Sheffield Hallam with the third safest Lib Dem seat in the country while the nominally more vulnerable Vince Cable is rated at 1/10 to hold Twickenham.  Similar observations could be made about the pricing of Danny Alexander's Inverness seat relative to that of Viscount Thurso's more marginal Caithness seat.
On current polling, most of the value must be found betting against the Lib Dems.  For those wanting to bet on the Lib Dems, Cardiff Central, Redcar and Berwickshire, Roxburgh & Selkirk may offer value.  But one thing is for sure - betting on these seats is not for the faint-hearted.

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