Horse racing by actual horses in America may be on its last legs. Aside from big events like the Kentucky Derby, attendance at racetracks is abysmal.
Crowds at Belmont in New York, for example, are down by nearly 90% from four decades ago, according to the End Horse Racing Coalition; tracks are closing; and races are in fewer and farther in between.
However, the horse race for US president is in full stride with record participation likely at the polls.
Terms like neck and neck and down to the wire (relating to equine contests) come to mind when considering the election on November 5th.
Below are three different methods for forecasting the outcome of the 2024 Presidential campaign: traditional polling; the betting markets; and campaign fundraising.
The Economist forecast, constructed from traditional polling data, which had been giving the leg up to Harris after she entered the race in July, reset to even on October 30, and as of November 3 had moved slightly in favor of Trump (51% to 49%), but essentially shows a statistical dead heat.
Source: The Economist
The Economist forecast lines up with the last New York Times / Sienna College poll conducted from October 20 – 23, which asked the question: If the 2024 presidential election were held today, who would you vote for? The results were: 48% for Trump, 48% for Harris.
However, alternative indicators point strongly in different directions.
The betting markets have been consistently forecasting a Trump win. The website RealClear Polling (RCP) aggregates odds data from betting sites like BetOnline, Betfair, and Bwin, and the November 3 “average” from RCP put the odds of Trump winning at 53.9% versus 44.9% for Harris.
Betting sites are an interesting way to measure sentiment, because their signals are derived from people willing to put their money where their mouths are. Polymarket claims a total of $1.8 billion has been wagered on the 2024 US Presidential election on its platform.
But it is also possible that some big fish are skewing outcomes. In a recent MarketWatch article by Brett Arends (who has covered sports and political betting for decades) the columnist warns: “the betting markets have their own flaws as a forecasting tool and need to be taken with a grain of salt.”
The betting markets also have been quite volatile. As recently as mid last week, Polymarket gave Trump a 67% chance of winning. That’s now down to 52%.
Another money-where-your-mouth-is measure is fundraising, and Harris leads by a sizable margin in campaign fundraising.
The Harris campaign fundraising efforts have outpaced Trump’s efforts by 3:1, according to Federal Election Commission Filings, as reported by Forbes on Oct 25.
And Harris’s campaign set a political fundraising record in the third quarter, bringing in $1 billion in the three-month period that ended September 30.
The majority of both campaign committees’ spending has been on advertising.
Given her cash advantage, Harris has been able to spend more of her time campaigning during the weeks prior to the election in swing states, while Trump has had to allocate time raising money in places where his popularity is high.
We will need to wait until election day (or, if not, hopefully sometime soon thereafter) to see how the money advantage plays out in the polls.
I’ll share a closing thought on the elections related to investing from the folks at independent research firm DataTrek:
“We see the US presidential election as a toss-up and we’re entirely OK with remaining long (owners of) US large company stocks regardless of the outcome. Our mental model is that America is a business as much as it is a country…
No matter which party occupies the White House or controls the chambers of Congress, companies always adapt and continue to innovate and grow.”
In my view, the DataTrek opinion (above) is sound long-term financial thinking and is strong “case for” sticking to a portfolio that supports your long-term financial goals.
-RK