-
UPDATE: Some smart comments, just below…
-
“InTrade’s market data shows that the sliding Dow Jones Industrial Average has an exceptionally strong negative correlation (approx. -0.91 over the last 10 weeks) with the rise in the InTrade Market for Barack Obama to be the next US President.”
“InTrade’s market data shows that the sliding Dow Jones Industrial Average has an exceptionally strong negative correlation (approx. -0.91 over the last 10 weeks) with the rise in the InTrade Market for Barack Obama to be the next US President.”
You can follow all the replies to this entry through the comments feed.
I assume this is voters going for Obama when the economy looks bad, not traders shorting because Obama makes things bad.
Which is fine for Obama opponents like me: I don’t mind knowing that to the extent that Obama wants to win the presidency, he wants American investors to lose money.
outstanding graph
, and fascinating.
Or people realize that Obama is a sure bet with a 50% return within 6 months. So, they move their funds out of the stock market and they buy Obama contracts instead. :-p
@Panos Ipeirotis:
-
By the way, Bary Ritholtz tells me that I should not confuse correlation with causality, that that the same factors that work to destroy the DOW are at work to help Obama.
How far out do DOW futures go and what have they done over this time period? Intrade has DOW contracts for EOY 2008, but then the new president won’t even be in office.
What is the stock market’s preference for US govt debt? I ask because http://www.bayesianinvestor.com/amm/implied.html clearly shows Intraders expect a bigger (~$500 billion) Increase in US Government debt between 30 Sep 2010 and 30 Sep 2011 with McCain in office.
Also, I wonder how much of that difference in expected debt increase is explained by a large (~100k) difference in expected Number of US troops in Iraq on 30 June 2010.