Top Trader

I am now a top trader of the week! Number 5 to be exact.
I'm apple1.

Low risk, high yield. Read on.

Market: Cubs 2006 Win Total
Stock: at least 60 games; at least 65 games
Risk: none at all

Buy equal shares of both stocks. As of 9/16/06, that would cost you about 80 Inkles. Look at the market page and look at the other stocks. Now look at the Cubs' record. You'll see that they have 59 wins and 89 losses. Since there are 162 games in a season, this means that the Cubs have 14 games left. If they lose all 14 games, then you're out of luck. But if they win just one more game, you're guarunteed decent profit. Once they win one more game, the Cubs can only have more than 60, or more than 65 wins. No more, no less. Either the Cubs lose 14 games straight (which would be ridiculous) or you make at a minimum 25% rate of return. I like.

UPDATE: The Cubs just won their 60th game. Now my little caveat about some risk is meaningless. Go ahead, by some.

Apple vs. Google

I have an inkling about this one. If all goes right this should be some easy money. . . I mean Inkles.

Market: Apple v Google Outperformance Market
Stock: Apple Outperforms Google
Risk: low/medium

This market asks the question, which will perform better, Apple or Google? Performance is defined as percent increase in share price as of 5/26/05. Here is a chart comparing Google's and Apple's share price percent change. Apple only needs to hold its lead on Google until September 30. That's only 11 more trading days. Right now, Apple Outperforms Google is trading at around 73 Inkles. If Apple does hold its lead, you'll get a 37% rate of return for 11 days of investment. Now the stock market is trickier (at least for me) to predict than other events (ie, sports, technology etc). So you may not want to dump all of your Inkles on this one. Try not to go higher than 50% of your Inkles available.

When in doubt, hedge your bet.

Market: MVNO Business Model
Stock: ESPN,Helio,Amp'd
Risk: depends/read post for details

This market simply asks, which of the following cell phone companies will go out of business first. The choices are Virgin Mobile USA, Helio, Amp'd Mobile, ESPN Mobile, and Movida. Let's take a quick look at each of these companies' profiles.

Virgin Mobile USA
This company is not going out of business (at least for a long, long, long time). They've had 3,000,000+ subscribers since the beginning of 2005. Virgin has been in the US MVNO market the longer than anyone else (about four years). They have carved out a rather large niche with its prepaid service. Virgin Mobile USA should be eliminated from any consideration for this market.

Helio
This company aims to take the Korean cell phone model to the US. It focuses on providing a rich data experience. Its key feature is that it is the only carrier that allows its users to access Myspace on the phones. However, its business model has been problematic. First off, they take a huge loss on each new subscriber ($300)and its phones are very expensive ($250-$275). This brings up another problem for Helio: one of its two handet manufacturers has filed for bankruptcy. Helio's founder Sky Dayton has said that his company will need around 3,000,000 subscribers to recoup the its investment. However, Helio has been reported as having fewer than 10,000 subscribers. Yikes. Helio's problem is that it is overly ambitious. It thinks that it can take the US market by storm and bring a foreign business model onto US soil. Helio has also anounced that it will open retail stores where users can "hang out". This is ridiculous.
Keep Helio under consideration.

Amp'd Mobile
Amp'd, like Helio, focuses on a rich media experience. And also, like Helio, is plagued with low subscriber numbers. However, it does have a pre-paid plan. Also, its phones are cheaper.
Keep Amp'd under consideration

ESPN Mobile
This phone pretty much caters to sports bums. We all know them. These are the people who have NFL Sunday Ticket, check their fantasy team stats compulsively and just cannot get enough Sportcenter. This seems good, but their subscriber numbers are low.
Merril Lynch expects them to sign up around 30,000 subscribers which is waaaay below estimates of 240,000.
Merill Lynch is no moron. Trust it, because while you're betting inkles, Merill is betting in real Dollars.
Keep ESPN Mobile under consideration.

Movida (sorry, no English site)
Movida is part of Sprint's attempt to tap into the 40,000,000 strong Latino American population. With prepaid plans and being the first to enter such a market, don't expect Movida to go bust anytime soon.
Remove Movida from consideration.

This leaves us with Helio, Amp'd, and ESPN. This is also where you will hedge your bet. As of Sep. 13, Helio traded for 23 Inkles, amp'd 25, and ESPN 21. My recommendation: buy all three of those. It's too tough to definitively determine which company sucks the most. So hedge your bet. One share of each company on Sep. 13 would cost a total of 69 Inkles. Once on of these three goes out of business, this "triple share" will be worth 100 Inkles. You will get about a 45% rate of return. This is riduculously high considering the low risk involved. Let's not kid ourselves here. There is no, no, no way Virgin Mobile is going under anytime soon. We also know that Mexicans will appreciate the first carrier catering to their Spanish-language needs. And we do know that these other three companies are doing awful.
Happy hedging.

UPDATE: ESPN Mobile is dead.

Britney and the K-Fed

Will Britney Spears' marriage last to the end of this year?
If you think so, then you can make some mad Inkles.

Market: Britney Vs. The K-Fed
Stock: Yes, they will survive
Risk: low/medium

With the news that Kevin Federline has now entered the rap world with a record deal and that Britney gave birth to the couple's second child, it seems that this marriage isn't ending anytime soon. And even if it does seem doomed for failure, it only has to last for about 3.5 more months for you to earn Inkles. As of September 12, the stock was around 62 Inkles. That translates into a 61% rate of return should the couple last by January 1st, 2007. Not too shabby for fewer than four months of investment.

UPDATE: I was flat wrong and paid the price.

My First Pick

Well here is my first stock pick:

If you've just signed registered with Inkling, and you don't know where to dump all those Inkles, I have a sure bet for you.
Market:AL East Winner
Stock: New York Yankees
Risk: virtually none

As of 9/12/06 the Yankees are at around 96 Inkles a share. They are also 10 games ahead of second place Boston. Unless something ridiculous happens to the New York Yankees, the will win the AL East. Love them or hate them, the Yankees will earn for you a roughly 4.1% return on your investment by the end of the regular season (or sooner should they clinch the Division title).
Note: You should by this stock ASAP as the price will get higher and higher, thus lowering the margin of profit.

Welcome

Well, here's the first post of what I hope to be will an informative blog on the world of predictive markets.
My market of choice is Inkling ( www.inklingmarkets.com ) so I will typically be writing about markets on that site. This blog gets its name from the currency on Inkling which is called Inkles. The "Mad" comes from the CNBC show "Mad Money" hosted by none other than the great Jim Cramer.

I will try to post in a timely manner and I invite you to leave comments and engage in discussion.

Thanks, and I hope you come back soon.