Financial Trading Blog

Financial Preview 05/05/2015: UK General Election 2015, Thursday 7th May 2015



And now, the end is near, and neither party looks like they will easily have it their way following the election tomorrow.


As the most recent polls have shown it is increasingly looking like the British public may have no clearer idea of who their new Prime Minister will be on Friday then they do now, even if the Tories do win the most seats. In fact, it was Cameron himself who signed off on the ruling that the largest party does not automatically form a government. Unsurprisingly then, Spreadex’s binary No Overall Majority spread has surged to 90.9-97.1, its highest price since campaigning began.

UK General Election 2015 Spreads 06052015

With that in mind, Spreadex is offering binary market spreads on the Next Government, with the two dominant options a Labour Minority, at 27.7-33.4, versus a repeat of the current Tory-Lib Dem coalition, at a spread of 25-30.8. Yet there are issues with both of these eventualities. A Tory-Lib Dem coalition would require a significant increase for the Tories on the current polling figures, which put Cameron’s lot on roughly 270-274 seats. However, Spreadex’s current Tory General Seats spread places them at 286-290, with the Lib-Dems at 24.5-26.5 meaning that, if each party reaches the upper limits of these spreads AND can broker a deal with UKIP and the DUP, the coalition could reach the 323 seats needed.

UK General Election Overall Majority Spreads Fixed Odds 06052015

Labour, on the other hand, has less to do to reach a minority government whilst simultaneously facing a rather more difficult beast to conquer if it can: public perception. Labour is currently on a General Seats spread of 264-268, and with the support of the SNP (at 47-49), the Greens (1-1.5) and Plaid Cymru (3.3-4.3) could have enough votes to ensure a minority government. Yet in this eventuality, there will a furore over issues of ‘legitimacy’, especially from the increasingly rabid right wing press. And it is this issue that will make a Labour minority all the more difficult, as the party will have to convince large swathes of the electorate that they deserve to be in power due to rules that many of the same electorate will be unware of. Yet for the shaky nature of such a government, the Labour Minority spread has seen the most money behind it, with Spreadex clients flocking to this option.

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