Pardon my ignorance but I just went to place a £2 bet (minimum) on Biden "Back All" at 1.07. Does that mean when Betfair DOES pay out, I will make a profit of 14p?
Surely not?
Surely not?
In this case, there are clearly people who are still willing to bet against (lay) a Biden Presidency, at very long odds. This is presumably either because they believe that the price adequately compensates for the low probability of it not happening, or to hedge risk that they have accumulated taking other positions while trading in this market (more likely IMHO).
One other factor is the cost of carry - while money is tied up in a bet it can't be used for anything else, including other betting strategies that might have a higher expected profit. In this case, if one has already made a profit betting for a Biden Presidency at longer odds than 1.07, it might now be worthwhile to pay someone else the slight risk premium to take up ones position until settlement, so that one can lock in the profit and move onto other things.
That Biden does not get elected President, or that he gets elected by the EC but effectively not assumes the office of President (e.g. due to a putsch/other form of emergency law, a SC decision, being arrested, being assassinated, dying of coronavirus, the EC election being delayed/cancelled due to coronavirus...)?
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