26 March 2016

Fantasy currency trading

Improbable?  Would you trust opinion polls to this extent?  The Times reports:
Hedge funds are preparing to use exit polls to make hugely profitable trades before the official result of the European Union referendum is declared.
Traders want to exploit a loophole in electoral law that forbids the publication of surveys while voting takes place, according to City sources.
Commissioning a private exit poll that accurately forecast how Britain had voted would enable traders to make a killing on the currency markets. A vote for Brexit is widely expected to trigger a decline in sterling against the dollar, but a surge is the likely outcome if voters choose to remain.
Aye, well.  The proposed trades will only be profitable (i) if the polls deliver the correct answer and (ii) the correct answer is not widely predictable (in which case any currency movements will already have been anticipated).  This is a manufactured story.


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