I promised myself I would also focus on a market neutral strategy. Yesterday (Pre-Market, Monday 10-May) I add 1 idea to my report: Long Standard Bank (SBK)/Short Investec (INL). As of 2pm on Tuesday afternoon, the pair was higher by 4.84% over the 2-day period vs -1.6% for the All Share Index for the same period. It closed +4.33%.
Market neutral strategies are used by traders to reduce risk while simultaneously attempting to generate alpha. To achieve this, traders make use of pairs trades which involves matching a long position with a short position in two stocks with a high correlation.
I'll continue to monitor for opportunities in this strategy.
Market neutral strategies are used by traders to reduce risk while simultaneously attempting to generate alpha. To achieve this, traders make use of pairs trades which involves matching a long position with a short position in two stocks with a high correlation.
I'll continue to monitor for opportunities in this strategy.
