Wednesday, February 28, 2007

In search of greater liquidity

Sigh.

20 Myths About Markets

Excellent short paper by Tom Palmer (hat tip Tyler Cowen). My favorites from the list:

13. Markets Can Not Meet Human Needs, Such as Health, Housing, Education, and Food

12. Markets Lead to More Inequality than Non-Market Processes

8. The More Complex a Social Order Is, the Less It Can Rely on Markets and the More It Needs Government Direction

6. Markets Cannot Possibly Produce Public (Collective) Goods

2. Markets Promote Greed and Selfishness

1. Markets Are Immoral or Amoral

My Dow call from 4 months ago

Back in late October, I called for a 4-500 point Dow correction in early 2007.

I got the index level wrong; the market continued to rally for these last few months. Here is some commentary retrieval:

OCT 27
I called the DOW.TOUCH.12000 back in late 2005 for 2006, and now I am calling for DOW.TOUCH.11600 in the next few months. While I don't think that equities are overvalued, I think a moderate selloff is coming, due to the following drivers:

+ end of reporting and fiscal year for many mutual funds and banks is holding off meaningful selling

+ VIX (volatility index) sputtering down to a 10 year low, and the suggested rebound in vol will bring some fear back to balance the greed

+ while most earnings reports are still to the upside, the share of disappointments is growing vs. previous earnings season. Also, revenues are not increasing as quickly anymore.
NOV 2
I am sticking with my DOW.TOUCH.11600.JAN2007 call from last month.

NOV 16
The DJIA will trade over 12300 today. A few weeks ago, I called a retreat down to 11600 through early 2007. I am now revising that target to 11800.

I am still looking more at economic growth and corporate earnings. Those are no longer growing faster than stock prices. One indicator of that: the price/earnings ratio of the S&P 500 has increased by 0.25% over the last couple of months.
Bearish sentiment may build, now that the collective psychological pendulum has moved a bit from extreme greed towards fear. But I am still generally bullish (until the baby boomers start collecting social security--I think Congress is like the crew of the Titanic, and will not be able to avoid the iceberg until things get really dire). Corporate earnings and household incomes should continue to rise in the coming years.

Dow Jones Industrial Average Index (^DJI)

Monday, February 26, 2007

Top 10 Mistakes Traders Make

From Jim Wyckoff (hat tip Chris Masse).

1. Failure to have a trading plan in place before a trade is executed. Without a specific plan, a trader does not know, among other things, when or where he will exit the trade or how much money may be made or lost.

2. Inadequate trading assets or improper money management. It does not take a fortune to trade the stock or futures markets successfully. Part of trading success boils down to proper money management and not gunning for those high-risk "home-run" type trades that involve too much capital at one time.

3. Expectations that are too high, too soon. Beginning traders who expect to quit their "day jobs" and make a good living trading in their first few years are usually disappointed. It takes hard work and perseverance to achieve success in any field of endeavor -- and trading is no different.

4. Failure to use protective stops. Using protective buy or sell stops upon entering a trade provide a trader with a good idea of how much money he or she is risking on that particular trade, should it turn out to be a loser.

5. Lack of "patience" and "discipline." Don't trade just for the sake of trading or just because you haven't traded for a while. Let those very good trading "setups" come to you, and then act upon them in a prudent way

6. Trading against the trend -- or trying to pick tops and bottoms in markets. It's human nature to want to buy low and sell high (or sell high and buy low for short-side traders). Top-pickers and bottom-pickers are usually trading against the trend, which is a major mistake.

7. Letting losing positions ride too long. Most successful traders will not sit on a losing position for very long. Traders who sit on a losing trade "hoping" the market will soon turn in their favor are usually doomed.

8. "Overtrading." If losses are piling up, it's time to cut back on trading, even though the temptation is to make more trades to recover the recently lost assets. It takes keen focus and concentration to be a successful trader.

9. Failure to accept complete responsibility for your actions. When you have a losing trade or are in a losing streak, don't blame your broker or someone else. You are responsible for your own success or failure in trading. You make the decisions.

10. Not getting a bigger-picture perspective on a market. One can look at a daily bar chart and get a shorter-term perspective on a market or stock trend. But a look at the longer-term weekly or monthly chart for that same market can reveal a completely different picture. It is prudent to examine longer-term charts for that bigger-picture perspective when contemplating a trade.

Sunday, February 25, 2007

EXTRA! EXTRA!


This was posted by my good friend DT (drugtest) in the forum but was deleted:


Saturday, February 24, 2007

TEN mgmt reply, and Todd's reply to them

Read the whole exchange here.

Todd is just brilliant; here is an excerpt from his latest reply:
I hope you feel I represented your email fairly, ideally, and intact like you seemed concerned that I wouldn't. My goal here was not to make you look bad, but to make you understand what its like on the other side of the computer screen. And that is obviously a position no one at TEN has every taken the time to view their business structure from. Maybe you feel everything works great, but from the support of my ideas in many forums by huge volume traders, not just the TEN forum, things are not running smoothly from our perspective.

I am aware of the split. I honestly feel bad for whichever company is keeping the current management. Hopefully, whichever site gets the new management; they are more open to suggestions that would benefit customer satisfaction and corporate bottom line. The current management does not seem to have the desire to create the industry leader that is so often referred to in statements from management. When your users/customers call you the industry leader, only then will it be reality.

Wednesday, February 21, 2007

Open Letter to TEN Managment from Todd

With Todd's permission, I am posting his open letter to TS regarding current issues. A couple other things of note, I decided I will start my own blog soon that is more broad based but I still plan on posting here. Also, Cav, you will be proud of me, I am reading Free to Choose by Milton Friedman and I find it fascinating. Here's Todd's letter:



Dear TEN Management:

I have decided to write you one final email in an attempt to discuss with you the problems that are existing on your websites, which continually go unacknowledged by your entire staff. The events of Monday evening have now pushed me to this point to try one last time to get a response from you. You will notice some attached forum posts in my email, and any emails that I reference are available to you. I will be happy to forward them to you if you'd like.

In the past 9 months, I have learned to use your site and become quite an avid trader. My trading volume must easily rank in the top traders on your combined websites. I trade sports and financials. However, the only thing that I now like about your website is strictly the concept of it. The unresponsiveness of the management and the disregard for the customers is alarming.

On this past Monday evening, The SMC/USF game was a live featured event. The forum reference for this issue is (http://forum.tradesports.com/eve/forums/a/tpc/f/809603632/m/3621061412). With one minute to go in the game, the exchange was closed for maintenance. The game was a 9 point game with a 5.5 spread. The game was an 8 point game with under 30 seconds to go, and the spread was totally in play. I first dialed your 1-866 phone #, and got no live help, I then sat waiting for live help via the internet and got no response even though I was first in line for over 5 minutes. Luckily for me, the game ended in my favor and the $2200 that I had at risk was credited back to my account. If you question my intention to trade in the last 1 minute of the game, let me include my trade lines from World Sports EXchange :
02/20/2007 02:06:18
Sell
10
CB-02-19-07-M1
ST MARYS -5.5
$90
Complete Fill
02/20/2007 02:06:23
Sell
4
CB-02-19-07-M1
ST MARYS -5.5
$90
Partial Fill

02/20/2007 02:08:56
Sell
1
CB-02-19-07-M1
ST MARYS -5.5
$100
Complete Fill
Unfortunately, I was unable to cover on TS because your staff closed out the system, and was 100% unresponsive. If you review the emails to and from live help and myself on the past few Monday nights you will clearly see that I remind your staff not to close out the system during a game, and get back messages from them basically telling me that they know. Well, apparently, they don't know, or possibly they don't care. Your promise to allow trading to the end of the game/event was 100% violated. I paid $44.80 in fees to trade this STC/USF game - and was approximately 20% of your volume. TEN should do the right thing and refund EVERY trader their fees from that entire game, and quite possibly take them from the employee who continues to make late night errors. If these were my employees who kept making stupid errors that upset a large portion of my clients, I would terminate them immediately. And this is not the first occurrence. To the same extent, many events have been paused before their completion - with the final outcome still in doubt - in an event to avoid traders covering their positions, so that TEN can save every last dollar in fees.(http://forum.tradesports.com/eve/forums/a/tpc/f/809603632/m/7751024691).

This brings me to my next two points, the first of which being your new fee structure. We all heard what it was designed to do. Increase traders and liquidity. I read the flowery statement from the CEO (http://www.intrade.com/news/news_101.html), about open contracts, new traders, new interest, etc., etc. But it has not resulted in increased liquidity. And if it has, none of the traders can see it. Don't you see the problem? TEN has created this mad dash to cover at the end of events to save a few cents as a trader, and has created this urgency in its employees to get events paused so they can save a few cents also. A well thought out plan would have eliminated this need to cover. It would allow a user holding a winning contract to sit back and relax, it would allow TEN employees to take their time in pausing an event to actually make sure the event is over. In addition this new fee structure has killed trading at the extremes, which is clearly proven in volumes in late game/event situations. When I am trading with TEN on a normal basis, my fees amount to $3000 a month. I don't mind paying a fee for a service, but the service I get in return from TEN is no where close to what should be expected. In addition to paying fees and being 'charged' for a service, have you ever considered giving a discount? This is the only site that I have used that offers nothing back to its users, and is by far the most expensive site to use. No refunds for being a large trader, no bonus, nothing In this link you will find a proposal I made regarding a fee refund structure that would promote higher volume and liquidity and be advantageous to being a high volume trader. (http://forum.tradesports.com/eve/forums/a/tpc/f/809603632/m/8451026112)

The next issue is your staffing decisions. It appears that once 4pm Dublin time arrives, there is no one left capable or authorized to make a decision to deal with issues that arise. All these employees are authorized to do it forward emails and leave the problems for the morning. Do you realize that almost all of your sports volume goes on while management sleeps? The majority of your finanacial (Dow/Nasdaq) volume goes on after Dublin business hours? Even a 24 hour McDonalds has a manager on duty at 4am. Someone needs to be responsible for what happens, and to deal with any issues that come about. Judging by emails I receive from live help during non-Dublin business hours, that person does not exist.

Regarding the grading of contracts, we all know there have been many issues. I did not trade the North Korea contract, so I cannot offer my opinion on it. But I have been involved in the past few weeks in a few sports mis-grades that continue to show the haste of TEN to get their fees and get money back into the accounts. Just last night, the LSU/UK game was paused as the clock when to 0, so obviously someone must have been watching the game via satellite. But the final score that the service you use was different from the one quoted at the end of the game. Wouldn't it make sense to clarify the situation before grading the event? This happened in a Chicago Bulls game and another college game earlier in the month. Why the rush? Information is the key to grading the events. And in some cases TEN (and now specifically Intrade) does not have the proper information to even grade events. If you refer back to my DOW Jones Hourly posts. The hourly contracts where TEN pauses at xx:00:00, and then claims - "The source used to expire the intra-day contracts will be the Time Stamped print at 10:00:00am ET/01:00:00pm ET or other contract specific time [or first print thereafter if there is no print at the specified time) as reported on Bloomberg." But in actuality the information that you use to expire these contracts does not ever even include a time stamp! The information that you expire on is some random point beyond xx:00:00 because TEN claims that the data does not exist. How can you have a contract paused at a specific time but then grade it on a data point that exists some random number of seconds beyond when we were allowed to trade it? Do you have any idea how much money I have lost out of on this technicality? Do you even care? The forum references for this issue are (http://forum.tradesports.com/eve/forums/a/tpc/f/809603632/m/2691083191), (http://forum.tradesports.com/eve/forums/a/tpc/f/169603632/m/7701093191), (http://forum.tradesports.com/eve/forums/a/tpc/f/169603632/m/3091048191/p/2)

On the topic of market makers, does TEN realize that their entire system is dependent upon them?? They control all events. Trading, price setting, liquidity. I will never make a market, its not my trading goal. Many others feel the same. These market makers need to be compensated so they don't need to make their markets wider in order to protect themselves. Market makers are openly admitting to changing how they are doing business to protect themselves. Your fee structure and benefits to them should protect them -- in return they will offer traders better markets, promote more volume, and ultimately increase liquidity. This will also motivate them to stay for the entire game/event. (http://forum.tradesports.com/eve/forums/a/tpc/f/809603632/m/8451026112) (http://forum.tradesports.com/eve/forums/a/tpc/f/809603632/m/7341030702) These issues also exist with the financial contract. http://forum.tradesports.com/eve/forums/a/tpc/f/809603632/m/2271068702

In your defense, I must say, dealing with banking issues, and trusting my money with your company, you are second to none. I have never once had an issue regarding a deposit or withdrawal. Any problems or questions that have arose have been dealt with promptly and fairly by some excellent employees. But on the topic of depositing and withdrawing, why haven't some of the suggestions been taken? (http://forum.tradesports.com/eve/forums/a/tpc/f/809603632/m/8451026112) Why is TEN so far behind everyone else? This will hurt volume if money cant be moved freely into and out of the site. Why cant some of those quality employees be available to handle other problems and create methods of increased liquidity?

I hope you do not take my emails and forum posts as personal attacks. Like I said in my opening statements, I like the concepts of TradeSports and Intrade, however there are many issues that go unaddressed -- and that is the fault of management. I would like to see the best for Tradesports/Intrade and would like to make my experience and the experiences of other traders to be positive ones, but I also fully understand the need for a company to make a profit. My suggestions to you take both into account. I have successfully owned, operated, and restructured many businesses and have always felt my opinions to be objective in balancing corporate profits with customer satisfaction. I feel if you begin to look your policies and procedures from both standpoints, your business can run more efficiently, achieve higher profit levels, and create a more stable and trusting customer base.

Thank you for your time and consideration. I hope this time you will take the time to respond to me either via email, or any other method you choose to contact me by. I am more than willing to discuss some of these issues with you further.

Sincerely,
Todd

Monday, February 19, 2007

Happy Presidents Day!

A holiday that some of us fortunately get to take off work for and a holiday that some of us didn't know even existed. However, during my reading of 1776 by David McCullough, I have found a new found respect for our Founding Fathers and past Presidents. Despite each Presidents' shortcomings throughout history, each has kept this nation together. The irony to all of this is that today, our struggles are not very different from that of General George Washington. To say we live in a polarized society right now would be to fail to view the world through the lens of history. In 1776, the country was split between the Loyalists and Sons of Liberty. Violence against each other was not uncommon. There was contempt between New Englanders and Southerners in the Continental Army. General Washington was almost removed from head of the army and lost the trust of his most trusted aide after losing New York City. To give perspective, read this quote:

"In August [1776], Washington had had an army of 20,000. In the three months since, he had lost four battles-- at Brooklyn, Kips Bay, White Plains, and Fort Washington-- then gave up Fort Lee without a fight. His army now was divided as it had not been in August and, just as young Lieutenant Monroe had speculated, he had only about 3,500 troops under his personal command-- that was all." (1776, David McCullough, pg 249)
While we may have our struggles today, our situation is indescribably more favorably than that of America in 1776. Just as today, there were doubts then about the fate of the war. Washington's leadership was questioned after being proven to be indecisive and unable to act in his failure to keep the British and Hessians from taking over New York (that and British naval power). The General was humiliated and questioned if he was fit for the job. Yet as history showed, George Washington kept his grit and proved to be the savior of the "Glorious Cause" and an astounding leader. So today, let us appreciate the comforts we have in life and not take for granted the leader of our nation. To quote Thomas Paine (the author of Common Sense) in his essay "The American Crisis" shortly after the loss at New York "...that the harder the conflict, the more glorious the triumph. What we obtain too cheap, we esteem too lightly..."

Wednesday, February 14, 2007

Barack trips, does he stumble?

From OpinionJournal:
On Sunday Sen. Barack Obama, speaking at Iowa State University, made this jaw-dropping statement:

We ended up launching a war that should have never been authorized, and should have never been waged, and to which we now have spent $400 billion, and have seen over 3,000 lives of the bravest young Americans wasted.

Wasted! Hard to believe anyone would say such a thing, but there it is on video.



Price for 2008 Democratic Pres Nominee(Others on Request) at intrade.com


I suppose McCain is hoping for the same kind of Audaciousness from Rudy.

Very friendly NY Times article on prediction markets

Could this type of media coverage help our legislators "get it"?
Intrade, in other words, isn’t just an entertaining Web site. It is the latest iteration of one of the most important economic developments of modern times.

It has also been remarkably clairvoyant. Heading into the 2004 presidential election, Intrade’s odds correctly forecast the outcome in all 50 states. The 2008 election is far enough in the future that the current odds probably aren’t as telling. But they are still worth considering, especially because early odds have had a better forecasting record than early polls in recent years, says Mr. Wolfers, who spends much of his time studying prediction markets.

(Hat tip Chris Masse).

UPDATE: My good friend bmili posted on this last year. As usual, way ahead of the pack!

Saturday, February 10, 2007

Why the minimum wage increase hurts the lower class

The excellent Glen Whitman:
The minimum wage is obviously symbolic for its advocates, especially the politicians who back minimum wage hikes. It’s a relatively cheap way for them to say, “I’m on the side of the poor and downtrodden.” But informed advocates almost certainly know that the minimum wage is a lousy way to help the poor even if the disemployment effect is small or nonexistent. It’s simply not well targeted to help who it’s supposed to help. Many of the beneficiaries are teenagers, sometimes from reasonably well-to-do households, not single moms trying to support families. It doesn’t distinguish between sole wage earners and members of multi-income households. If you really wanted a policy that helps those who need it, you’d create a means-tested transfer program or expand the EITC, not go mucking around with market wages. But the minimum wage is appealing politically because it’s easy to understand (let’s pay people more!), and to the public at large – which doesn’t see or understand the trade-offs – it sounds like either a pure free lunch or a simple transfer from rich firms to poor employees.



Price for Minimum Wage Increase at intrade.com


Thursday, February 08, 2007

Albert Pujols- MLB Role Model

In a day of age where role models are lacking (extremely in professional sports), Albert Pujols stands tall above the rest. Mr. Pujols became a US citizen today by scoring 100% and by answering additional questions that were not necessary to pass the test. Congratulations Mr. Pujols! Read the account here.

Todd advised TS management about increase liquidity

Hopefully, his wisdom will be considered with all haste and understanding. (Hat tip Chris Masse).

Time to wake up and smell the coffee Mexico

Those of you who follow this blog have learned that I have adopted soccer as of late as one of my favorite sports. My interest in soccer was nil until summer school in college a few years ago. Bored out of my mind since most people were gone I developed a new-found love for the Texas Rangers and followed the Euro Cup 2004. Since the Euro Cup, I didn't pay much attention to the sport until the World Cup this last year where I tried to watch every game. I can see why now it is the world's most popular sport. The pride, the history, the tense moments, the explosion when a goal is finally scored. So last night I was absolutely thrilled when the US beat Mexico 2-0 in an international friendly on US soil (albeit Mexican fans outnumbered US fans). This win gives the US much more confidence after an abysmal World Cup performance (although we were in the toughest group by far with the Czech Rep, Ghana, and Italy). But my main point is that Mexico is stuck in its own hubris about its superiority. Until the year 2000, the US was no more of a small dog biting at ankles. Since 2000, the US has gone 8-2-1 against them with the only 2 losses coming in smog filled, high-altitude Mexico City. Mexico has not even scored a goal against the US in the past 8 games here! Luis Bueno at CNNSI.com sums up the game perfectly here. Mexico is in a state of denial.

Wednesday, February 07, 2007

Goodbye TS

I logged in today at TS for the second time in about three weeks or so (at least it feels like). And I came across this link posted by Cav in the pit. Todd (73nj) sums up his complaints about TS perfectly and TS has caused me to go elsewhere for business. I do like what TS did with the cross of free market economics with sports/non-sports events; however, the management is apathetic and lethargic. Every site that I have come in contact with is much more user friendly and moving money in/out is so much easier. I guess this my TS Post-mortem.

Tuesday, February 06, 2007

Zack's Interview

I got an e-mail from one of the people who run the Zack's Challenge about publishing an interview from the top players regarding their investment strategy. Currently, I am 17th out of a few thousand entrants. I will post a link if/when it gets published.

Monday, February 05, 2007

Super Bowl betting spotlights silly laws

Nice plain speaking article on why gambling laws are silly, from Al Neuharth (founder of USAToday). Hat tip to Steve Levitt.

One of my old posts instinctive drives to wager.

An even earlier post on why the US legislation is bad law.

Nobelist Gary Becker on discount rates for global warming estimates

Some alarmists would have a discount rate near 0%, which doesn't square with time value. Read the whole thing.

WSJ (subscription required) pokes scientific holes in the UN-sponsored IPCC study:

More pertinent is the underlying scientific report. And according to people who have seen that draft, it contains startling revisions of previous U.N. predictions. For example, the Center for Science and Public Policy has just released an illuminating analysis written by Lord Christopher Monckton, a one-time adviser to Margaret Thatcher who has become a voice of sanity on global warming.

Take rising sea levels. In its 2001 report, the U.N.'s best high-end estimate of the rise in sea levels by 2100 was three feet. Lord Monckton notes that the upcoming report's high-end best estimate is 17 inches, or half the previous prediction. Similarly, the new report shows that the 2001 assessment had overestimated the human influence on climate change since the Industrial Revolution by at least one-third.

Such reversals (and there are more) are remarkable, given that the IPCC's previous reports, in 1990, 1995 and 2001, have been steadily more urgent in their scientific claims and political tone. It's worth noting that many of the policymakers who tinker with the IPCC reports work for governments that have promoted climate fears as a way of justifying carbon-restriction policies. More skeptical scientists are routinely vetoed from contributing to the panel's work. The Pasteur Institute's Paul Reiter, a malaria expert who thinks global warming would have little impact on the spread of that disease, is one example.

U.N. scientists have relied heavily on computer models to predict future climate change, and these crystal balls are notoriously inaccurate. According to the models, for instance, global temperatures were supposed to have risen in recent years. Yet according to the U.S. National Climate Data Center, the world in 2006 was only 0.03 degrees Celsius warmer than it was in 2001 -- in the range of measurement error and thus not statistically significant.

The models also predicted that sea levels would rise much faster than they actually have. The models didn't predict the significant cooling the oceans have undergone since 2003 -- which is the opposite of what you'd expect with global warming. Cooler oceans have also put a damper on claims that global warming is the cause of more frequent or intense hurricanes. The models also failed to predict falling concentrations of methane in the atmosphere, another surprise.

Meanwhile, new scientific evidence keeps challenging previous assumptions. The latest report, for instance, takes greater note of the role of pollutant particles, which are thought to reflect sunlight back to space, supplying a cooling effect. More scientists are also studying the effect of solar activity on climate, and some believe it alone is responsible for recent warming.

I am still waiting for these.

Friday, February 02, 2007

Some interesting historical data on the Superbowl

From Allen St. John of the WSJ (subscription required):
Over the last 22 Super Bowls, 18 -- 86% of them -- were won by the team that came into the game after allowing fewer regular-season points. (In the 2004-05 regular season, the New England Patriots and the Philadelphia Eagles each allowed 260 points.) Not since the Denver Broncos won 1999's Super Bowl XXXIII has the team with the weaker defense emerged victorious.

And that's why the underdog Chicago Bears should defeat the Indianapolis Colts in Miami on Sunday. Lovie Smith's NFC Champion Bears allowed only 255 points during the regular season. That's third-best in the NFL -- and is a whopping 105 points fewer than the AFC Champion Colts allowed.

More bad news for Colts fans. In the regular season, the Colts defense allowed 360 points -- more than any team that has won the Super Bowl. Since the advent of the 16-game schedule in 1978, only three winning teams allowed 300 or more points in a season -- the 1983-84 Raiders (338), the 1998-99 Broncos (309) and the 1980-81 Raiders (306).

And while much has been made of the Colts' powerful offense, the Bears scored the same number of points -- 427 -- in the regular season. Indianapolis quarterback Peyton Manning has been the focus of attention, but his Chicago counterpart Rex Grossman has been about as efficient in his passing this post-season -- with 6.66 yards per attempt vs. Mr. Manning's 6.84 yards per attempt.

That brings into view another trend pointing to a Bears win. A good gauge of a team's strength is its ratio of points scored to points allowed -- and the measurement we use to express that ratio is Pythagorean Wins. Since Super Bowl XIX, the team with more P-wins has gone 18-4 (81.8%) making it a more reliable indicator than a team's actual record, which predicted the outcome just 76.5% of the time. This season, the 13-3 Bears outscored their opponents by 172 points (better than five of the last six Super Bowl champs) and led the NFC with 12.36 P-wins. The 12-4 Colts, on the other hand, outscored their rivals by just 67 points, which projects to only 9.59 P-Wins. No team in history has won the Super Bowl with a P-win total that low.

Instead of listening to the pundits who say their team has little chance against the Colts, maybe Chicago fans should focus on this: Only three teams since the 1970 NFL-AFL merger -- the Raiders in Super Bowls XI, XV and XVIII -- have entered the big game with fewer P-wins and a more porous regular-season defense than their opponents and still managed to win.

Savvy fans may dismiss many of these numbers, arguing that the AFC was the far better conference this year. That may be true for the conferences, but it doesn't necessarily hold for this matchup. The Bears and Colts played five common opponents this season -- the New York Jets, New York Giants, Patriots, Buffalo Bills and Miami Dolphins. Indianapolis went 5-0 against these teams, while the Bears were 3-2. However, in those games, the Bears scored 114 points and surrendered only 75, outscoring their opponents by 39 points. The Colts? Despite their perfect record, they scored 128 but gave up 107, for a 21-point differential, just over half that of the Bears.

I got long a little NFL.COLTS after they beat the Patriots. More recently, my boss asked me to get long a ton of NFL.BEARS, which is paying 2:1. Either way, I am happy.


alt="Price for Super Bowl XLI Winner at TradeSports.com"
title="Price for Super Bowl XLI Winner at TradeSports.com" border="0" />