I have gone through most of the pair trading strategies listed here and found no realiable returns over its backtest.
Pair trading being one of the safest strategies out there with its concept of hedging, how come these algorithms are having major lose trades even after selecting good performing stocks i.e with a look ahead advantage.
Am i missing something? Are there more to these algorithms ?
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Hi Sharooq,
Because Pairs Trading is so popular, a lot of the opportunities have been arbitraged away by firms. I'd suggest checking out the Optimal Pairs Trading strategy for a decent strategy, and try to play around with the parameters and pairs.
Best,
Shile Wen
The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory services by QuantConnect. In addition, the material offers no opinion with respect to the suitability of any security or specific investment. QuantConnect makes no guarantees as to the accuracy or completeness of the views expressed in the website. The views are subject to change, and may have become unreliable for various reasons, including changes in market conditions or economic circumstances. All investments involve risk, including loss of principal. You should consult with an investment professional before making any investment decisions.
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