Quote from: RationalSpeculator on June 05, 2013, 02:09:03 PM

Quote from: Zebulon Pike on June 03, 2013, 08:50:47 PM

.. it is disingenuous to keep highlighting the 10x number with regards to valuation and dividends. If this were the primary factor at play, then when the price dropped back down to 5x of what it was in February, then theoretically share price should have doubled from what it was at the peak of the exchange rate, which isn't what happened.

Are you sure?

I am looking at prices on havelock 'charts'. On the 9th of april when bitcoin peaked out at $266, sdice bottomed out at 0.0012. In the next 7 days bitcoin prices tumbled to a low around $50 on the 16th of April, while sdice went up again and reached a high of 0.0042 on the 15th of April. So while bitcoin prices were cut by 5, sdice did quadruple. Pretty close match I would say.

Since then prices of bitcoin have about doubled from $50 to the current $120, while sdice has about halved from 0.0042 to the current 0.0020. Also a pretty good match I would say.

From this evidence I think it is correct to conclude that the exchange rate of bitcoin is strongly inversely correlated to the sdice share price. If bitcoin goes up, sdice shares will fall in btc price. If bitcoin goes down, sdice share will go up in btc price. It's not perfect, but it's close.

This means that sdice is a good protection against falling btc prices. But equally it's a no go if you want to profit from rising btc prices.

Cash does a better job in protecting against falling btc prices, than sdice, but cash does a worse job in profiting from btc rises, than sdice.

This may be a market/exchange fragmentation issue, but I was not looking at Havelock. It appears that they are issuing shares of a proprietary fund that is made up of shares of SD, but they are not a place trading in actual shares on a 1-1 basis, so the prices they reflect are for shares of their SD-based fund (presumably with a premium on top).

I was using https://bitfunder.com/asset/G.SDICE for my data, which has fairly different values (looking at the 3- and 6-month charts)