Prediction markets show Trumps lead over Harris expanding to 23

With just two weeks and one day left until the upcoming U.S. presidential election, there has been a significant increase in the likelihood of Donald Trump securing a second term, according to major prediction market platforms.

Although traditional polling data suggests that the Republican candidate is gaining ground, especially in crucial swing states, national polls still indicate a close race. As of now, Kamala Harris maintains a narrow lead of 1.7%, as reported by FiveThirtyEight and Nate Silver’s model.

After the presidential debate, both Harris and Trump had equal odds of victory in the prediction markets. However, by October 4, the Republican candidate managed to pull ahead with a 1% lead. Just four days later, his lead widened to 7%, and by October 16, it expanded to 19%. These increases coincided with the release of favorable polling data for Trump’s campaign.

Nate Silver’s latest update reveals that Trump’s fortunes have turned in his favor in every swing state, both on a monthly and weekly basis. While Harris holds a slight lead in Wisconsin and Nevada (0.3% and 0.6%, respectively), Trump’s smallest margin, in North Carolina, is 0.8%. His next smallest margin, in Georgia, is twice as wide at 1.6%. If this trend continues, Trump could be leading in Wisconsin, Michigan, and the national race by Election Day.

Interestingly, prediction markets have reacted more dramatically than official data. Trump now holds a comfortable double-digit lead in the prediction markets. His chances of victory stand at 61.3%, a 1.5% increase from the previous update, whereas Harris’ odds have decreased to 38.5% after a 1.7% drop, according to international platform Polymarket. The margin between them is 22.8%.

U.S.-based prediction platform Kalshi also favors Trump, with odds at 57% compared to Harris’ 43%. While lower, the margin on Kalshi is still a significant 14%.

However, it is crucial to note that prediction markets cannot replace rigorous statistical models based on reliable polling data and established methodologies. Prediction markets provide a glimpse into popular sentiment but should not be solely relied upon.

A recent report from the Wall Street Journal raises concerns about potential manipulation of election odds in prediction markets. It suggests that the increased odds favoring Trump could be a result of intentional manipulation. Analysis firm Arkham Intelligence’s CEO, Miguel Morel, believes that four accounts (Fredi9999, Theo4, PrincessCaro, and Michie) created between June and October belong to the same entity. These accounts have collectively placed around $30 million in bets, funded through the same crypto exchange, and exhibit similar betting patterns. Economist Rajiv Sethi, who co-authored a paper on a similar case of manipulation in Senator Mitt Romney’s 2012 campaign, shares Morel’s views. The Wall Street Journal also reports that Polymarket is investigating the matter.

In conclusion, it is important to remember that prediction markets are profit-driven ventures. The odds are structured to generate returns for the platform rather than providing an accurate reflection of electoral probabilities.