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Pair trading for cryptocurrencies in today’s financial market

The principle of paired trading is that of two assets and it is very important to adhere to a strategy that brings maximum results in today’s financial market realities. This all is for cryptocurrency trading, as well as for classical trading. This principle fully satisfies the requirements of discerning investors, because it is applicable to a market neutral portfolio of stocks.

J. Frank Sigerson

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The principle of “paired trading” is that of two assets. Which has a correlation of more than 90%? And belong to the same market industry, bring their high results.

Crypto-exchange is a highly correlated asset

With respect to the crypto-exchange, if the paired trading principle is applicable to highly correlated assets. As a matter of fact, the optimal solution is to use a bot. For example, for trading on a Bitmex Bot for paired trading. On the other hand, the Bot does an excellent job of calculating the difference between one currency and another in a paired transaction. And automatically uses all trading resources.

As for pair trading, the correlation is not 100%. In addition to this, there is still a discrepancy. The possibility of profit formation at the trades increases as well.

This picture show a ma using a smartphone checking crypto prices.
The Bitmex Dual Trader Bot performs its functions perfectly. (Source)

Pair trading bot cryptocurrency

The Bitmex Dual Trader Bot performs its functions perfectly. And the Bitmex Dual Trader Bot has undeniable advantages. To tell the truth, the Bitmex exchange produces some of the most global trading volumes in the range of $1.5 billion per day. In addition, Bitmex has a cross-mode with the retention of the security deposit for all pairs. And the ability to use the capital leverage for trading, the size of which ranges from 1 to 20 and to 1 to 100.

There is another well-known pair-trading mode – the advanced one. It includes trading currency pairs against a basket of currencies. Such a combination of modes is possible only with the use of a trading bot. Which exceeds the manual mode by tens of times. And is able to perform the calculation of discrepancies, trading. And calculation around the clock on the machine. As well as: to fix profits, to act strictly adhering to the strategy without compromising emotional decisions.

This picture show a man looking a the computer screen keeping an ey on social media.
Pair trading does not have absolute arbitration. (Source)

Pair trading for experienced traders or for beginners

The advantages of automated bot for pair trading are obvious not only for experienced traders but also for beginners. The bot, which you can learn more about at algotrading.center, is unique and has such characteristics:

Bot for paired trading on Bitmex

What’s good about paired trading with cryptocurrency? If we compare this strategy. We can only do it with arbitration. Unlike arbitration. Pair trading does not have an absolute correlation. There is much more discrepancy in this type of trading. Which means that the earning potential is much higher.

This bot has an advanced pair-trading mode. Namely, the ability to trade not only one currency pair against another. But also a currency pair against a basket of currencies. This makes it possible to smooth fluctuations and improve convergence.

(Featured image by Andre Francois McKenzie)

First published in cryptonovosti, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. B2I assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. B2I is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.

 

 

J. Frank Sigerson is a business and financial journalist primarily covering crypto, cannabis, crowdfunding, technology, and marketing. He also writes about the movers and shakers in the stock market, especially in biotech, healthcare, mining, and blockchain. In the past, he has shared his thoughts on IT and design, social media, pop culture, food and wine, TV, film, and music. His works have been published in Investing.com, Equities.com, Seeking Alpha, Mogul, Small Cap Network, CNN, Technology.org, among others.