Initial trading at an election stock market projects B.C. Greens playing a decisive role in the provincial game of thrones.
The Greens may actually get to choose who’s going to be king or queen.
That’s what early results of trading show in the Sauder School of Business Prediction Markets being run out of UBC.
Trading opened on March 1, and as of this writing, one of the three markets predicts a hung parliament.
This particular market is about the seat count for the 87 electoral districts at play.
According to trading results for seat numbers, the ruling B.C. Liberal Party will get 42, not enough for the magic number of 44 to form a majority.
The B.C. NDP is projected to win 41 seats; the Greens, three; and others, one.
This means that the next government will be formed based on which party the B.C. Greens choose to be aligned after the May 9 election this year.
The Greens have only one current representative in the B.C. legislative assembly, Andrew Weaver.
B.C. Liberal Premier Christy Clark has praised Weaver for taking what she has described as focused and principled positions.
But as market director Werner Antweiler stresses, it’s really too soon to know what’s going to happen in the May 9, 2017 provincial election.
“It’s still early going in the election,” Antweiler told the Georgia Straight in a phone interview Wednesday (March 29).
Although this may be the case, the Sauder School of Business associate professor noted that traders are making rational choices.
“The traders are acting like any trader in the futures market,” Antweiler said. “They’re trying to predict the outcome of the election, and they have a financial interest in getting this prediction right, regardless of their particular political leanings or preferences. So the idea is that traders put their money where their mouth is.”
Anyone, who is a Canadian resident and at least 19 years old, can participate in the market. Each investor can put in up to $1,000.
It’s a non-profit venture for the Sauder School of Business. For traders, just like the real stock market, they earn by buying low and selling high.
Share prices are in cents, and are generally deemed as percentage probabilities for election results.
According to Antweiler, the prediction markets have an educational purposes, which is to teach participants how trading and strategy work.
“Markets are providing probabilistic statements; it’s not saying one party will win or not, but it’s saying, well, there is a certain probability that they will win,” the academic explained.
In addition to the seat count, there are two others in the Sauder School of Business prediction markets.
One is for the popular vote share. As of this writing, this market shows B.C. Liberals getting 40.5 percent of the popular vote; B.C. NDP, 39.8 percent; Greens, 11.1 percent; B.C. Conservative Party, 6.8 percent; and others, 1.8 percent.
The third market is for prediction of majority government. The market currently shows 55.6 percent projecting a Liberal majority government; 38.7 percent, NDP; and others, 5.7 percent.
And as Antweiler noted, everything can change.
“If traders believe there is a change in sentiment or trend evolving, they may actually anticipate where this trend is going,” he said.
The writ will be dropped on April 11, the day the election will be officially called.
As the campaign progresses, prospects will become clearer.
Antweiler noted: “More likely that there will be a clear winner than a hung parliament.”