Tag Archives: Cointegration Pair Trading

EXAMPLE PAIR TRADE OF THE MONTH SEPT 2020

October 30, 2020 1:36 pm |
LCI Industries Inc. (LCII:NYSE) vs. Polaris Inc. (PII:NYSE) September was a good month for the signals generated by the August 2020 Vintage of our Top 30.   As an example pair trade, we want to drill down on a pair that has consistently delivered profitable trades over the last year, that of LCI Industries Inc. (LCII:NYSE) vs. Polaris Inc. (PII:NYSE).  The latest trade called on the pair didn’t disappoint, delivering $578 Net Profit and a 15% return on margin in 4 days.  Here is a detailed trade entry and exit analysis for this example pair trade: Video: Pair Trade of the Month Sept 2020

example pair trade

Backtest Results:

In backtesting over the three years prior to 24 August 2020,

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Cointegrated Stock Pairs: Top 30 August Vintage Post a Perfect Record in First Three Weeks of Live Trading Out-of-Sample

September 16, 2020 3:41 pm |

Cointegrated stock pairs

Pair Trading stocks involves simultaneously entering LONG (i.e. BUYING) and entering SHORT (i.e. SELLING) two “paired” stocks.  It has been shown to provide protection from market crashes, controlled risk, low correlation to the market averages and ability to generate significant and consistent returns.  Multiple recent research studies have demonstrated returns to be in the range of 2%-4% per month*, on a 4:1 leverage basis, over more than a decade.  Add in the use of Cointegrated Stock Pairs and the historical returns look even stronger**.

PairTrade Finder® PRO’s Top 30 Cointegrated Stock Pairs

But we prefer to put our money where our mouth is. 

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Correlated Stock Pair Trade of the Month: April 2020

May 12, 2020 9:16 pm |
Eastman Chemical Company (EMN:NYSE) vs. Element Solutions Inc. (ESI:NYSE)

$1,210 in Four Market Days, 30.3% Return on Margin.  Best correlated stock pair trade for the month of April 2020!

ESM and ESI are a correlated stock pair that we selected in late March for inclusion in our latest April Vintage of the Top 30 U.S. Equities Pairs.

Watch our video:

correlated stock pair

Backtest Results of this Correlated Stock Pair:

In backtesting over the three years prior to 1 April 2020, cointegrated and correlated stock pair EMN/ESL delivered 8 closed trades,

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The Stock Pair Trading Strategy and the Secret of Cointegration

April 12, 2020 9:39 am |

Learn one of the best-kept hedge fund secrets for deploying the stock pair trading strategy – cointegration.  Used by professionals for over 50 years to deliver consistent monthly profits from stock trading, regardless of market direction. It also carries the additional benefit of protection from market crashes and big account drawdowns through the use of hedging.

Click here to watch our video that explains it all:

stock pair trading strategy

Combining Cointegration and Stock Pair Trading for a Winning Combination

Professional traders and hedge fund managers love to use the stock pair trading strategy.  

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