Idol Bets

So the Idol Finals are over and the only thing left to hear is who won.  An interesting thing happened last night in the Idols market and is definitely worth noting (I plan on writing some strategy articles here during the “offseason” that will go more in-depth on market strategies) and that is how the markets react during and right after a show.  There was a massive drop in David Cook’s stock value last night immediately following the show.

By most accounts Archuleta performed better than Cook so it’s a natural assumption to get rid of your Cook shares ASAP.  Well in doing so, people dropped the sell value of his stock from 66 to 25.  That’s a massive fall and would have been a great time to purchase some Cook shares if you actually understood how the results would turn out.  I said several weeks ago that Cook was a shoe-in.  I initially had my doubts, the biggest of which is that Archuleta would outperform him during the finals (which he did) but I later said that it wouldn’t matter.  Archuleta dug himself into such a giant hole that he never recovered from.  It really wasn’t his fault but his ridiculous personality and lack of legitimate emotion and connection with his songs doomed him.  He would need 3 more nights like last night to make up the margin Cook had built.

Because of that, I never suggested hedging your Cook shares with Archuleta shares.  It made SOME sense do hedge with Syesha shares two weeks ago, just in case but there is a big difference between hedging with $4 shares and hedging with $30 shares.  I was confident enough in Cook’s chances not to suggest even selling any of his shares.  That MAY be something you’d want to look into to reduce some of your risk but at this point, Cook looks like the winner.

In case you don’t know, DialIdol is predicting Cook to be the winner and it’s by a large enough margin to be statistically accurate and outside the margin of error.  That information is very strong and telling and should be accurate.  Unless DialIdol has decided to throw it’s credibility out the window and take advantage of the betting markets by providing false data, then Cook shares should be worth $100 at the end of tonight.  DialIdol is a pretty big reason why the Cook shares recovered nearly all of their lost value today, that and the ridiculously low price they were selling for last night.