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Set it and Forget it: The Top 10 Bargains for the 2020 Election
With the Democratic primaries mostly wrapped up, many of you are sitting around with some solid gains burning a hole in your pocket. That means it’s time to pivot towards building positions for the November election. And while there is plenty of free money on the table already, most of us don’t want to double max California at 97c seven months out. To this end, I have compiled my list of states with the right combination of reasonable price and likelihood of winning that make them the top bargains worth going deep in right now. Sorted from least to greatest, David Letterman style.
10. Florida (Current Price: Republican Yes @ 53c)
While Florida is considered the definition of a swing state, it hasn’t been too swing-y in terms of statewide elections in the Trump era. Trump took the Sunshine State in somewhat of an upset in 2016 as polling had the race tied, but potentially unregistered demographic shifts were seen to be favoring Clinton. Didn’t work out. Since then, Republicans were able to flip a Senate seat and retain the governorship in a year when Democrats were accomplishing opposite results in other swing districts and states across the country.
Polling will be tight, many more articles will be written about demographic shifts favoring Democrats, and the potential impact of statewide felony enfranchisement will be analyzed relentlessly. I won’t be fooled and have sworn a blood oath with one of my trading comrades never to bet on Democrats winning Florida ever again. At the end of the day, the strength of Trump’s brand in Florida combined with recent history indicates that he is more favored in the state than prices would indicate and is top ten steal at 53c.
9. Maine (Current Price: Democrat Yes @ 75c)
Hillary Clinton won Maine by about 20,000 votes in 2016, which was good for a 3 point spread. Since then, Democrats have taken the governor’s mansion, flipped the state legislature and stolen a House district from Republicans that Trump had previously won by 13 points. Maine will assume a higher national profile this year with incumbent Senator Susan Collins (R) considered highly vulnerable. This will set up a strange dynamic with Trump trying to win the state and retain the Senate, while Collins’s lack of independence from him is seen as her chief liability. Collins might get an obligatory endorsement tweet, but I don’t expect to see them stumping together. What I do anticipate is some ticket splitting with voters rejecting Trump again while giving Collins a second chance. Bottom line, Maine is roughly 10c underpriced at 75c with no identifiable bright spots to give Trump hope for flipping the state.
8. Virginia (Current Price: Democrat Yes @ 85c)
Hillary Clinton won Virginia comfortably in 2016 and Trump has done nothing to improve his chances in the state since. Democrats took three House seats in 2018, no Republican has won statewide office in the commonwealth since 2009 and Democrats have taken both chambers of its legislature, making it one of the most reliably blue states on the map. This is a free 15c right now, but PredictIt history has shown me that there is always a Quixotic effort by a stubborn set of traders who like to burn money trying to will a Republican in Virginia– so a better price may come before Election Day.
7. Colorado (Current Price: Democrat Yes @ 83c)
Hillary Clinton won the state by 5 points in 2016 and nothing that has happened since would indicate the territory has improved for Trump in the four years since. Democrats retained the governor’s office, flipped a House seat and Republican Senator Cory Gardner is assumed to lose this fall. Piling on that, Trump is extremely unpopular in the state– so Colorado is a bargain below 90c.
6. Minnesota (Current Price: Democrat Yes @ 75c)
This market is priced like a swing state based on Hillary Clinton’s surprisingly narrow victory in 2016 in comparison to Obama’s blowout four years earlier. However, Democrats have dominated in statewide contests since. Also, see the comparative factors below regarding depressed turnout in Michigan and Wisconsin. The likelihood of Minnesota reverting back to a comfortable Democratic win is underpriced at 75c.
5. Michigan (Current Price: Democrat Yes @ 64c)
Donald Trump won Michigan by a whopping 10,700 votes in 2016. Hillary Clinton’s defeat came as a result of several factors: 51k votes for Green Party candidate Jill Stein (up from 21k four years prior), an estimated 20% decrease in African-American voter turnout, and her campaign’s overall neglect of the state. Democrats will be strategic in ensuring these factors do not repeat themselves and have a pool of hundreds of thousands of voters ripe to pull the lever for Biden who did not pull it for Clinton. Add in that Biden crushed the Democratic primary here while Clinton lost four years earlier, and this could be an indication that it will be friendlier territory for him this November.
On paper, Biden can win by increasing turnout marginally without flipping one Trump voter. But recent electoral history predicts there will be some voters primed to swing back the Democratic Party. For example, Dems were able to retake the governor’s office, retain a Senate seat and flip two House seats in 2018. This, in combination with Trump’s double digit disapproval rating in Michigan and his constant presence on the wrong side of head-to-head polls against Biden there pretty much eliminates any argument for him repeating his 2016 Motor State miracle. Biden’s price in this market is a steal.
4. Wisconsin (Current Price: Democrat Yes @ 60c)
Similar to Michigan, Donald Trump won Wisconsin by a slim 23,000 votes in 2016, with Democratic votes impacted by Green Party defectors, lower African-American turnout, and Clinton acting like the state was in the bag when it wasn’t. Also similar are Democrats’ success in the state since. Previously resilient Scott Walker was evicted from the governor’s mansion, two state Supreme Court seats were taken from Conservatives, and Democrats were able to retain a Senate seat. Head-to-head polls also put Biden ahead of Trump (although less so than in Michigan) and his approval in the state is 10 points underwater. Michigan and Wisconsin will likely go in tandem and price is the only factor that makes Wisconsin the slightly more attractive bargain.
3. Ohio (Current Price: Republican Yes @ 62c)
While Obama won Ohio twice and it was the site of some razor thin victories in the past, it has since drifted into a space where Republican victories are reliable and easy to come by. Trump blew past polling expectations in 2016 to win the state by 8 points, despite the vocal protestations of popular sitting Governor, Republican John Kasich. Democrats can point to incumbent Sherrod Brown earning re-election in 2018 as a sign of strength, but Republicans retained the Governorship and powerful Secretary of State office (which has arguably been used as a tool for voter suppression that mostly impacts Democratic voters). The current Congressional delegation from Ohio is twelve Republicans to four Democrats and no seats were flipped from red to blue in 2018. Biden might be able to attract Ohio voters in a way Clinton could not, but a potential 8 point swing isn’t worth 38c to me.
2. Texas (Current Price: Republican Yes @ 73c)
I really just wanted to write “It’s Texas,” but I guess the #2 bargain deserves a little more explanation. Democrats’ pursuit of a statewide victory in Texas is as unending as it is unrequited. Its existence as a symbol of traditional Republican values, along with its potential electoral vote haul, give it an outsized amount of national attention for a potential Democratic upset. The influx of former blue state residents to its multiple urban centers, along with age and race demographic shifts, give some credence to the argument that Texas could tip in the not-too-distant future. However, I would not bet on that happening in this Presidential election cycle as Trump’s approval, existing fundamentals and recent electoral history demonstrate that the Republican label is still a winner in Texas. You may want to wait to see if some poll that puts Biden within 3 points and gets screaming headlines scrambles the price, but the outcome is going to be the same in the end.
1. Nevada (Current Price: Democrat Yes @ 75c)
This might not have been the price you were anticipating for the #1 bargain, but it’s what you’re getting. Nothing about 2016’s results or other elections in the state since would indicate that Democrats should have any trouble winning Nevada in 2020. Democrats have a growing edge in registration and a labor-backed turnout machine that maximizes their advantages. Add in the increasing percentage of non-white residents and Trump’s deeply underwater approval, and Nevada should probably be priced above 90c like the other states considered a lock for Democrats in November. Double max and start counting your money now.
So there you have it, the path to the least stress/most gains for the big show, if you want them.
Last piece of advice: If you plan on plunking down 17k to double max both sides of each of these bets (what are you some kind of coward?) and then pulling a Rip Van Winkle until November, best to do it now rather than later. Once Biden announces his running mate, that person’s upside will be factored into every relevant state (Amy Klobuchar will deliver the upper midwest! Kamala Harris will boost African-American turnout across the board! Warren will deliver progressives!) and that will be the first move towards these markets reaching their true values. And whatever you do, set those sell orders at 90c. Good luck, my friends.
Footnote on Pennsylvania: By some of the logic I laid out for the other states above, in combination with Biden’s roots there, it should also be considered a bargain at 61c. But betting on that place gives me the heebie-jeebies, so I’m leaving it alone. Peace.