In the world of trading, where opportunities and pitfalls abound, equities pair trading stands out as a strategy that offers unique advantages. For intermediate-level traders with a solid understanding of trading and basic mathematics, employing the cointegration method in stock pair trading can unlock a world of potential gains. In this article, we delve into the benefits of equities pair trading using the cointegration method and explore the likely expected trading returns based on the latest academic research focused on S&P 500 stocks.
Understanding Equities Pair TradingEquities pair trading involves selecting two correlated stocks and taking positions based on the historical relationship between their prices.
… Read More →The start of 2020 is a great opportunity to decide how to re-deploy your time and energy to meet your goals. If one of your goals is to develop a second or multiple income stream to allow you diversify away from reliance on a job, then why not take the time with us to learn to trade stocks for income?
Traders from around the world have downloaded PairTrade Finder® PRO over 6,500 times. The platform has sold over 2,250 licenses and subscriptions to-date. It has helped many new and seasoned traders alike achieve consistent profitability in their trading.
… Read More →Since Q2 2009, the most common of stock trading strategies – passive “long-only” i.e. just buy the S&P 500, would have delivered 348% or a 15.2% CAGR with dividends reinvested and without transactions costs or management fees (Source: https://dqydj.com/sp-500-return-calculator/)
But with the S&P 500 at or near a new all-time high, is the risk still weighted in your favour? Perhaps, if you can hold 20-30 years. But what about the next few years?
If you had held the S&P 500 from January 2008 until January 2009, the S&P 500 delivered a -35.6% return with dividends reinvested and without transactions costs or management fees (Source: https://dqydj.com/sp-500-return-calculator/)
The man in who made the quotation in the picture above is Larry Hite.
… Read More →According to top trader Martin Schwartz, trading psychology is the name of the game for success:
Martin S. Schwartz (Buzzy) is a Wall Street trader who made his fortune successfully trading stocks, futures and options. He received national attention when he won the U.S. Investing Championship in 1984. Schwartz is the author of Pit Bull: Lessons from Wall Street’s Champion Day Trader (source: wikipedia)
Improve Your Trading Psychology with a High Probability Pair Trading SystemHow do you find your trading edge and master your emotions and tendencies to let it play out in the markets?
… Read More →Here at PairTrade Finder® we aim to trade stock, ETF and FX pairs with high cointegration, correlation and historic win rate. Why? Because even though a lot of these trades will fail, if you are persistent and disciplined, in the end the edge is with you.
What is “edge”? You hear traders talk about it all the time. Here’s an interesting definition from Investopedia’s Alan Farley:
A trading edge is a technique, observation or approach that creates a cash advantage over other market players. It doesn’t have to be elaborate to fulfill its purpose;
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… Read More →Exhaustive and robust academic research of stock pair trading strategies on the S&P 500 show consistent trading gains. Stock pair trading, especially using cointegration for selecting pairs, has shown historic profitability of up to 5% per month. Learn to trade stock pairs in our 30 Minute Webinar. Sign up for a 15-Day Free Trial and get our eBook Trade Like a Hedge Fund for free.
Free triallers also receive access to our Pair Trading Video Training Course. Taught by a professional pair trader, this series presents pair trading in simple,
… Read More →Learn pair trading of stocks long/short for consistent profits. Join our free 30-Minute Webinar Trade Like a Hedge Fund and start your 15 Day Free Trial of PairTrade Finder® PRO today.
Free triallers also receive access to our Pair Trading Video Training Course. Taught by a professional pair trader, this series presents pair trading in simple, easily accessible terms. Its 11 lectures span over three hours and access is yours at no extra cost. Our course gives you the tools to begin trading stock pairs profitably in as short a time as possible.
Exhaustive and robust academic research of stock pair trading strategies on the S&P 500 show you the way.
… Read More →