Big Arb on Hilary...

[AvivaSimplex]

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I'd load up on the no personally. Hillary's way too much to the left for Dems to run her in '08. The GOP's alienated so many people that if the Dems run someone closer to the middle or at least less controversal they'd win in a landslide.

My money's on Obama.

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Sorry, but if you think Hillary is the left-wing candidate in the 08 primary, you don't know what you're talking about. She's just about down the middle of the Dem spectrum. Gore and Feingold are both credible and more liberal than her. The moderate/centrist space was taken up by Warner, who recently dropped out. Now Biden, Bayh, and others are moving in. Hillary in some ways has the worst of both worlds, because lefty liberals think she's pandering by offering things like the flag burning amendment, while conservatives have already decided they hate her and she's too liberal.

Obama seems to be loved or at least liked by everyone who knows anything about him. However, the experience issue will be a big one. He's smart enough to know that people who have been in the Senate for 20 years never become president, so if he wants to make it into the Oval Office, he has to leave the senate. The current Obamania is really his opening bid to be vice president.

While I'm at it, Gore is very well liked by about 15% of the population, and is disliked by 60%+, despite the recent good publicity of his global warming movie.

Edwards was basically a zero during the 04 campaign, so he'd have to show more credibility as a campaigner.

Clark was not a good politician in 04. If he's spent the past 4 years learning to speak the language and feel comfortable in front of crowds, he'll have a good shot at the nomination.

Feingold is widely perceived as too liberal to win the general election, but that could be an asset during the primary. He (with Gore) is the favorite of the Daily Kos crowd.

Richardson is an outside possibility. He has charisma and the racial advantage of being Latino while looking white. The knock on him is that he's not a particularly deep thinker.

But basically, it's way too early to tie money up for nearly two years.

[ojc02]

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Let's say we have 100 to spend on this. What is the optimal way to bet it? We will be x on the 'no.' So we 1.1x-(100-x)=1.29(100-x)-x. So we bet $52.16 on the no and $47.84 on the yes. Thus we can expect a return of $9.55.

Now let's say we put the money in a money market account for two years. The return will be 100-100e^(2*r) where r is the interest rate. So let's see what rate we need to break even 109.55=100e^(2r). So r=.0456.

Can you get better than that?

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Technically this assumes continuous compounding. Most money markets compound monthly so it's actually:

109.55 = 100(1+(r/12))^24

r=0.0457
[img]/images/graemlins/tongue.gif[/img]

[beetman]

Don't forget to factor in Tradesports's commission. +110 is closer to +106.5 after the commission is included.

Money market aside, a skilled gambler should definitely be able to find better opportunities than tying up money for 18 months in that arb.

[knicknut]

Not to mention a money market is FDIC insured and risk free.

Betting at two sportsbooks, especially with the legality grayer than ever, is not.

Is the 1% extra you might get over a standard MM account a suitable risk premium to compensate you for the risk of losing your whole investment? The answer is obviously no--do you see why?

[ImBen]

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Is the .5% you give up relative to at least half a dozen widely available MM accounts a suitable risk premium to compensate you for the risk of losing your whole investment? The answer is obviously no--do you see why?

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