#TradingPairs101 Here's an overview to get you started:

🔍 What Is Pairs Trading?

🧠 Key Concepts

Correlation vs. Cointegration:

Mean Reversion:

Z-score:

🛠️ Steps to Build a Pairs Trading Strategy

Identify Potential Pairs:

Test for Cointegration:

Calculate the Spread:

Compute the Z-score:

Set Entry and Exit Points:

Backtest the Strategy:

⚖️ Pros and Cons

Pros:

Potentially profitable in various market conditions.

Cons:

Requires rigorous statistical analysis and monitoring.

Profitability depends on the assets