Very interesting, thanks for your work. Most of the math is beyond my skills, hence someone else has to check.
One question though: How is the difficulty of 77,000,000 calculated at icbit.se? With the latest difficulty increase of about 10% it has to rise ~29% per jump for the next 5 times until September 16. This is far beyond the numbers that are discussed on the forums currently...
I have no clue. The futures market on that exchange decided it... they may very well be wrong.
And in case it wasn't clear, the idea is that the hedge I discuss in my article will be profiting even if they're wrong. i.e. whether DMS.SELLING pricing is wrong (in terms of expected difficulty) or these futures contracts' pricing is wrong, profit is made.