This morning I saw queues forming outside the Bookstores that line my road to work. Since I go to work an hour or two before these stores open, I realized they must be Harry Potter fans waiting to buy the last installment of their favorite series. Only when scouring the news, later in the day, did I read that this highly awaited book is being released at midnight tonight, at which point these devoted fans will have been in line for over 15 hours.
This leads to a confession I have to make: I have never read a word of any Harry Potter book.
Nor, for that matter, have I watched any of the movies. I realize this makes me sound like a contemporary literature snob, but I thought I should redeem myself by confessing it, as well as discussing Harry Potter in this post. Not knowing anything about the story, however, it will probably be a very short post.
I can start by surmising that Harry Potter will survive at the end. I do this by combining my faith in futures markets (which I have previously discussed here and here) with the fact that newsfutures.com lists the chances of Harry Potter’s survival at 75% (as of this writing. The chart below updates automatically so it may show a different number).
By just past midnight tonight we should know if this is correct, but I will be following the numbers very closely until then because the last minute changes tend to show the direction the ending will go in more precisely.
There, are, however, some caveats. First, there needs to be enough liquidity. The NewsFutures site lists 20,354 contracts held by players. Since one player can buy in excess of 1,000 contracts, however (once you sign up they award you 200 contracts for free), this is a very low level of liquidity.
Secondly, when I first looked at the site there was a 91% chance that he would survive. This could mean one of three things:
1. The trends have started reversing towards Harry Potter dying and therefore he will not survive.
2. There is not enough liquidity, as I mentioned before, and therefore few trades can skew the market.
3. These being the final hours of trading, there is just a great amount of volatility in the market.
Despite these caveats I'm standing by the theory and betting that Harry Potter lives.
Update (9:20 pm): Harry Potter now has a 99% chance of survival. It looks like he'll pull through.
Update (12:20 am): It looks like I was right, the theory worked, and good ol' Harry Potter made it in one piece.