You’re probably going to see election forecasts more this month, and one candidate will have a higher chance of winning than the other. Even so, it won’t mean much, because the forecast is basically a coin flip. Nate Silver explains the chances in the context of gambling:
Gamblers understand this, perhaps like nobody else. Yes, if you think Harris is really a 55/45 favorite and prediction markets have it the other way, you have a profitable wager — but you’re still going to lose the bet almost half the time. (There have been much bigger discrepancies between models and prediction markets in the past.) In sports betting, the breakeven point on a point spread bet is generally 52.5 percent — that’s just enough to cover the vig — but most experienced bettors would avoid the 53/47 games1 to reduce variance and because there’s ultimately no way to know that your model is right. In poker, you can’t avoid making tough decisions — you always have to fold, raise/bet, or check/call — but many decisions in the game are so close that you’re literally supposed to randomize your play, employing a mixed strategy because being unpredictable outweighs any slight edge from one line being superior to another.
