FX Spread – Automated Pair Trading

1 Star2 Stars3 Stars4 Stars5 Stars (3 votes, average: 4.00 out of 5)
Loading...Loading...
Buy now

You want it?

  • Definition
  • Mathematical Model
  • Videos

FX Spread is a quantitative trading platform designed for strategies based on pair trading. This tool allows you to design and implement strategies for different instruments as currencies, indices, synthetic indices and commodities.

Pair trading or trading with “spreads” is a market neutral strategy that allows benefiting from bullish, bearish or sideways market. In this strategy the investor takes a bullish position in an asset (eg .: DAX30) and a short position in another asset (eg .: EURX50) trying to take advantage of the gap or difference between two assets that are highly correlated (similar movements markets).

FX Spread shows the correlation between one, two or three instruments as well as the average of last periods, RSI, Bollinger, trends and trends prediction, in timeframes M5, M15, H1 and D1.

Advantages

  • Eliminates the risk by allowing neutralizing market trend or the laterality of assets.
  • Lower portfolio volatility: faced with sudden market movements, whether bullish or bearish, the position is protected by a dual directionality.
  • Reduce commissions: being “protected” against these movements allows not being constantly operating and expanding the stop loss, avoiding being in and out of the market with their respective commissions.
  • No constant monitoring of the position needed: not having a directional market risk allows tracking the position quietly.
  • Make profit taking: A “spread” between 2 assets depending on the risk profile of the investor should be set in the range between 2% -5% profits.

To build a “spread” prices of assets are subtracted and an artificial asset is obtained as follows:

 

  • Spread = USOIL –UKOIL
  • Spread = EURUSD- GBPCAD
  • Spread = DAX30 –2 CAC40
  • Spread = XAUUSD -XAGUSD

Don’t wait any more

Try our trading platforms one week for free

Description

Share this

Platform for trading strategies based on pair trading with different instruments.

Project Details

Client
Date November 18, 2015
Categories Tools

Uso de cookies

Este sitio web utiliza cookies para que usted tenga la mejor experiencia de usuario. Si continúa navegando está dando su consentimiento para la aceptación de las mencionadas cookies y la aceptación de nuestra política de cookies, pinche el enlace para mayor información.

ACEPTAR