Top Election Day Trade
Political donors are like investors.
They expect a return on their investment.
You’re seeing the returns on that payment now in real time.
The American Rescue Plan Act shored up public employee pensions in the states that were headed for a fiscal cliff.
The last Inflation Reduction Act guaranteed subsidies for alternative energy sources and installed a regulatory agenda to keep energy prices high for years to come.
Big donors get big payoffs when they win.
It’s no secret.
This election cycle is no different. But it’s one huge investment that caught our eye.
It’s $411 million on a single issue.
And if it wins, watch out. A small handful stocks are absolutely going to soar.
Here’s the situation and the stocks to watch because it’s just a few weeks away.
California's Next Hot Growth Industry
Some of the world’s most profitable companies have been pumping hundreds of millions of dollars into a Californai campaign.
It isn’t for the senate or governor though (this is California, and those are decided well beforehand in a single party state).
It’s for legalized sports betting.
And the results of this election could launch a major growth industry into another gear.
Of course, there’s a major catch.
And once you understand the catch, you’ll see why this could be a monster trade in a couple of weeks.
Here’s the setup.
There are currently two ballot measures in California to legalize sports betting.
The first ballot measure is Proposition 26.
If this passed it would open up sports betting to the more than 60 casinos and race tracks in California.
This would be a boost for sports betting, but it wouldn’t be enough to move the needle much because it’s legal in so many other states.
The second ballot measure is Proposition 27.
This is the free-for-all proposition.
It would open up the sports betting market to mobile betting.
Bettors could place bets anywhere, anytime.
This is the one that has attracted the hundreds of millions of dollars of investment in a campaign for approval.
They’re betting so much money on it because if it passes, it will be worth many times that.
But again, there’s a catch.
Best Bets If California Legalizes Online Sports Betting
The catch is Prop 27 which would completely unleash sports betting in California has “just 27% of likely voters, with 53% opposed and 20% undecided,” according to CalMatters.org.
That is both good and bad.
It’s bad in that this is no sure thing bet. It’s best to wait until results are in before buying.
It’s also good in that the market expectations are super low. So if it passes, the big sports betting stocks are going to have to catch up big to account for this major event.
Any way you look at it, California is a huge sports betting market.
The state has nearly 40 million people. Basically, 1 in 11 Americans live in California.
And if you compare it to Arizona, where $5 billion in bets were placed in first year of legalisation.
California would easily be $20 billion and be a near doubling of the legal sports betting market again over the next year.
That’s huge and will go a long way to driving some stocks higher.
If you’re looking to jump on after the election and it passes, the two best ways to play it are with the big sports betting companies.
Draftkings (DFKG) is as close to a pure-play as you’ll get on sports betting.
Meanwhile, Flutter Entertainment (LON:FLTR / US:PDYPY) is the Eruopean betting giant that now owns another big sports betting company Fanduel.
Both would likely get a bump if California opens up for sports betting.
Probably a big bump.
Stay ready.
Election day is coming.
