And yet Link: Intrade says BO has 58% probability of reelection
I wish that everyone would stop worrying about Intrade. It means nothing. It's the equivalent of a bar bet, albeit nearly a million of them. Here's an explanation I posted last night:
The all-time highest daily volume for Obama winning the election was 21,889 shares on 9/1. That same day, the volume for Romney winning the election was 32,822 shares (also an all-time high).
A winning share pays $10. So, you can consider the price of the share to be approximately 1/10th of the probability of winning. At the close on 9/1, Obama was $5.84/share, and Romney was $4.21/share.
That means that 1 day's volume (on 9/1) for Obama was 21,889 * $5.84 = $127,831. And the same day, the volume for Romney was 32,822 * $4.21 = $138,180. That's a lot of money to you and me, but that's chickenfeed to someone that wants to manipulate it for political purposes.
But, only a fraction of that would be needed. First, that daily volume is 4-5 times the average daily volume up until the last few days. Second, only a small number of shares are available for immediate trade right now, to satisfy outstanding orders. If you were to buy or sell all those, the price would move very quickly.
Right now, I could boost Obama's share price from $5.82 to above $5.98, buying 3,017 shares for $17,794. That would satisfy all the outstanding orders currently listed. Conversely, I could depress Romney's share price from $4.16 to below $3.88, selling 9,048 shares for $37,290. I wouldn't even have to own those shares -- I could effectively create new shares immediately.
Moving either one all the way to 0 or 100 could get a bit expensive. There are a total of 410,183 open shares for Obama and 402,797 open shares for Romney. But, even at the maximum price of $10/share, that's still only a bit over $8,000,000 for both, combined. That's the total "capitalization" of the market, currently -- although more shares can quickly be added by people selling shares they don't already own.
So, do you see how easy it is to manipulate the Intrade prices? It's like a penny stock -- relatively moderate amounts of money can move the price a great deal.