Trading Pair is a market neutral trading strategy letting traders make profit from various market conditions such as downtrend, sideways or uptrend movement.
A market-neutral strategy means that profit doesn't depend on the direction of market. This strategy has several sections such as convergence trading strategy and statistical arbitrage. Jared Mann is the person who created the proven pair trading system that we currently use in Pair Trading.
Pair trading, also known as spread trading, is indeed the largest and biggest used strategy of hedge funds. Trading Pair keeps on increasing and developing with online traders. In addition, the other pair trading signal services are not available in real time and not available in the web world.
The strategy monitors the actions of two historically correlated securities.
Pairs trading strategy demands good position sizing, market timing and decision making skill. Though the strategy doesn’t have much downside risk, there is a scarcity of opportunities. For making profits the trader should be one of the first to capitalize on the opportunity.
Traders can use either fundamental or technical data to construct a pairs trading style. The pairs trading play an important role to market risk and hedge sector.