Sarbjit Bakhshi, Smarkets Head of Political Markets, joins Yahoo Finance's Kristin Myers to break down the latest overseas betting odds in the 2020 race to the White House.

Video Transcript

KRISTIN MYERS: Well, let's talk the 2020 election. It's just days away. And betters are still spending millions in this year's race. And interestingly enough, twice as many bettors are putting their money on Donald Trump, not Biden. So to track this, we're joined now by Sarbjit Bakshi. He's the Smarkets head of political markets.

Always great to chat with you, Sarbjit. But you're going to have to explain this to me because I don't understand it. I am not a better. I am not a gambler. I know that Biden is still favored to win, yet twice as many bettors are backing Trump. How does that work exactly?

SARBJIT BAKHSHI: Well, it's a really interesting phenomenon because we've seen so much money go in our $15 million next president market, $1 million more than last week alone. We are seeing that, looking at the numbers, twice as many people, as you've said, are backing Trump as Biden.

But the people who are backing Biden are putting down twice as much money on a Biden victory than those who are supporting Trump. And that's keeping the prices as they are and keeping them static, which is Biden at 66% to Donald Trump's 33% to win the presidency in 2020. A 1% drop for Joe Biden on that, but not changing the final score by very much. It still looks like a Biden victory.

KRISTIN MYERS: So does that mean that, essentially, bettors might be trying to reduce their risk perhaps if they're putting these smaller amounts on Donald Trump and much larger amounts on Biden? How does that-- how does that work? I guess, you tell me the gambler or bettor's mind.

SARBJIT BAKHSHI: So I guess they're all different people who are trading on this market. Because this market is kind of like the wisdom of the crowds. So those that-- there are a lot more people who just believe that Donald Trump are going to win. So they're putting down their money.

The other people have done, looking at the polls, looking at other indicators, and are just more confident in Joe Biden's victory and are willing to take the money from that side and put down their own money on the opposite side. So that equilibrium caused by Biden supporters, the Biden traders, putting twice as much money on average as Trump supporters, is keeping the market stable.

In normal times, people wouldn't be twice as confident in the other side on this kind of market. But here, there's a real mixture of people who are trading here, maybe people who are putting their first trades down, maybe people who don't really follow politics very much, maybe people who just like Trump who want to put some money, show their support, and hopefully have a successful outcome come November 3, November 4.

KRISTIN MYERS: So speaking about the odds, since the bettors are spending so much on Biden right now, what are they right now for Biden against Trump and wondering if they've changed at all. I think I saw that there has been a very small drop in the odds for Biden.

SARBJIT BAKHSHI: Yep, that's 66% for Joe Biden, 33% Trump, a 1% drop for Joe Biden there. And interestingly, looking at the electoral college map, we're seeing a slight shift of 13 electoral college seats towards Trump, which means that Biden's on 3, 1, 4, and Trump's on 2, 2, 4 in terms of electoral college. That's still a Biden victory.

Looking at the other states, everyone's talking about Texas maybe flipping our markets, putting that 72% Republican. Florida, it's a toss up state. It's still a toss up state on our markets. It's 53% to the Republicans, 47% towards the Democrats.

But more interestingly, I think, than all of those, is that Rust Belt. The Rust Belt are so important for Joe Biden-- Pennsylvania, Michigan, and Wisconsin. If Joe Biden can when those three states, Florida becomes irrelevant. It doesn't matter which way Florida goes. Joe Biden will win the presidency.

And look at where they are in our markets. Pennsylvania is at 65% to go Democrat, whereas Michigan and Wisconsin at around 75%, 76%. It looks like, looking at these three markets alone, it could be all over for Trump now, regardless of Florida.

KRISTIN MYERS: All right, so I have about a minute left with you, Sarbjit. So I wanted to ask you, we've been seeing record breaking voter turnout. I know that the bettors have also been very enthusiastic, roughly 15 million, I believe US dollars, being spent on this market.

I'm wondering if your bettor market is reflecting that increased enthusiasm, if you've seen the numbers really start to increase, and if you're expecting that perhaps millions more flowing into this betting market in just the next three days.

SARBJIT BAKHSHI: Well, this is-- you know, this election is like a really slow motion election. Because we've had things like we've been talking about this for over a year, or over two years maybe. We've seen the melt of people voting early. And the amount of money traded has been going on, which has been incredible, over the last few weeks.

We can expect-- I'd expect there to be almost double this amount by election night. I expect people all to be getting out their phones, getting out their website, the Smarkets website, and putting down money on this, and trading this right up to the final pips. We're trying to hold our markets just when polling closes in each state.

But with, you know, we talked about 50% early voter registration already going in, you know, come the times that the polls open, this might already be all over for one of the candidates.