Last month, the United Kingdom voted to leave the European Union. The United Kingdom European Union Membership Referendum - better known as the "British exit" or "Brexit" - captured the attention of what seemed like the entire world as fears, hope, and speculation took hold. One community who took notice of the growing interest in Brexit was the bookmakers.
Despite political and non-sports betting rarely taking center stage with the major bookies, top online betting sites began offering generous odds on the vote to 'leave' or 'remain' well before last June. This build up led experts to predict Brexit would draw in around £100m in wagers, an unprecedented sum for non-sporting events.
As most know, the result - the UK voted to leave the EU - not only took the bookies by surprise but most of the world as well, resulting in international calamity as people looked to understand what the vote actually meant.
Following the results, top bookmakers revealed their massive loses as well as the total amount of wagers placed: the Brexit vote brought in a total of £120m in wagers, setting the world record for the largest sum of wagers placed on a non-sports event.
The decision to leave the European Union was one few saw as a reality. Even as polls showed growing support for the 'leave' campaign, most experts around the world - including those experts expected to predict the outcome of events, the bookies - were blown away by the result of the vote. Stock markets around the world plummeted, currencies fluctuated and general calamity ensued.
Unfortunately, some bookmakers, like most financial analysts, were some of the many who miscalculated the results and paid dearly for it. Some of the world's top bookies lost hundreds of thousands on the Brexit voting, including industry-leader William Hill Sports. WH took £3m in bets on the vote that resulted in a net loss of around £400,000.
WH's Media Relations Director, Graham Sharpe, confirmed how surprised most experts were with the results. He also went on to explain how WH ended up on the wrong side of the net gains while other top brands broke even or made some money from the unexpected results:
"Very few saw this coming. It must be that more people backed ‘leave’ with us than other bookmakers."
Further research revealed that is exactly what happened; According to the Financial Times, 68% of the total money wagered on Brexit at William Hill Sports was placed on 'remain' while 69% of the individual bets were placed on 'leave'. WH wasn't the only bookie to lose a ton on the surprising vote but some top brands escaped without much loss.
Few bookies predicted the outcome correctly but only some suffered as William Hill did. Despite incorrectly calling the results, Ladbrokes, Betfred, and Coral, among others, avoided the same massive payout WH suffered, with Ladbrokes actually reporting a six-figure take home from the bets.
Ladbrokes Sports, like pretty much everyone, expected the 'remain' vote to prevail but thanks to smaller payouts for the winning punters, Ladbrokes was able to actually take home a nice sum.
Ladbrokes revealed the average 'remain' wager was around £400 while the average wager on 'leave' sat at around £70. The number has yet to be announced, but thanks to relatively small bets on the winning 'leave' vote, Ladbrokes did confirm at least a six figure profit.
Other top bookies like Coral and Betfred weren't as fortunate as Ladbrokes but were extremely satisfied to not end the day in the negative. Betfred Sports took just over £1m total in wagers on Brexit but was able to close the market with a small surplus; not a big take away but certainly more desirable than William Hill's major loses.
Coral Sports wasn't able to take home much from the Brexit voting but was able to avoid landing in the negative as well. Coral also took on about £1m in bets but thanks to some cheeky book-keeping, the topnotch bookmaker was confident they were breaking even regardless of the outcome of the vote.
Politics, or really non-sports events in general, has never really taken the spot light when it comes to online betting. Major television shows, like Britain's Got Talent, and certain political events, like the Scottish Referendum, have caught the attention of punters and bookies but certainly never created a truly captivating buzz.
Then came Brexit. Thanks to the importance of the vote and the extensive international coverage, Brexit not only caught the attention of the media but the bookmakers finally saw an opportunity for a novelty bet to take center stage.
Starting in 2015, top bookmakers began offering odds on the 'leave' or 'remain' vote. At the time, it was almost certain the 'remain' vote would triumph but as the vote approached, the 'leave' campaign gained momentum. The shift from a "all but certain" outcome to the opposite result was a perfect story line for this budding market.
In total, about £120m was wagered on Brexit. Close to £80m of that total sum was wagered with Betfair's exchange, meaning punters were betting against other punters, while the remaining £40m came from all the bookies who opened the market. For perspective, the UK general election last year totaled about £25m in wagers.
The Brexit vote was historic for a number reasons including its impact on the world of novelty betting. Aside from setting the now seemingly unreachable record, Brexit showed bookies not only can they grab the attention of the punters with a non-sports bet, they can lose big doing it.
If you're looking for the next big wager on a non-sports event, don't hold your breath as they only come around so often but thanks to the Brexit vote and the growing interest in things outside your typical athletics, you can easily find a wealth of novelty bets to play.
Head over to Paddy Power Sports today and check out their extensive list of novelty bets!