Blog categorized as Learning Pairs Trading

Pairs trading often looks consistent in simulation. You identify two related assets, track their spread, and act when the deviation widens. On paper, the process appears controlled. In live markets, the same setup behaves differently due to execution, costs, and decision pressure.

This gap is not the...

Pairs trading looks structured on paper. You long one asset, short another, and trade based on the assumption that the spread may revert under certain conditions. In practice, outcomes depend on how well you handle changing relationships, execution, and risk.

Most losses don’t come from one wrong tra...