How to Pairs Trade - This is a simple and interesting strategy to do pair trading. I don't do pair trading. If you are into it then probably you might know this strategy already. It is a short article. Gist of the strategy is, take the ratio of the pair and apply RSI on it. Then use RSI oversold & overbought conditions to trade the pair accordingly. Rest of details in the article. Technical Indicators: A Statistical Approach - The core idea of this article is to apply statistical concepts (think z-scores) to technical indicators for making them robust. Then you plot the z-scores just like the technical indicators. Interesting idea to investigate.
Are Cover Stories Effective Contrarian Indicators? - I have not read the paper but the title and abstract sounds interesting and useful.
Is Your Fund Manager Active Enough? - Barron's cover story for last week. A measure called "active share" tries to differentiate active managers from closet indexers.
Negatively Skewed Trading Strategies - Many of the trading strategies—statistical arbitrage, convergence trades, risk arbitrage—that hedge funds employ are negatively skewed strategies. Here is an example. A trader tracks over time the credit spreads of a large set of bonds. When a bond’s spread widens, the trader buys the bond. He waits for the spread to return to its historical levels, sells the bond, and pockets a profit. It works like a charm, except occasionally the spread continues to widen, and the trader is left holding a distressed bond.
Correlation based Asset Allocation - The strategy is fairly simple i.e., use correlation between stocks and bonds to determine Risk On - Risk Of mode and then invest in equities or bonds depending on the regime. Then this method is applied on a multi-asset portfolio. For timing, the article applies moving averages on correlation and looks for a cross. Another notable is the article claims this approach has low correlation with standard MA systems. Lots of stats and simple to implement. Short on time, so I didn't try to verify it myself.
CBA - Quick test drive - This is a variant of the above study done by another blogger. Good one.
Renaissance Capital 2012 US IPO Review - Total 10 pages with stats. Provides good overview of IPO activity in 2012.
Miscellaneous
CES 2013 - A Window into the coming years technology trends - CES (Consumer Electronics Show) is a huge show with lot of threads. This article captures some of the trends this year at the show.
Glass that bends the rules of manufacturing - Corning developed a thin, flexible glass, but the real breakthrough was figuring out how to mass-produce it.
6 trends that will drive electric vehicle adoption in 2013
- Title self explanatory.
Data deduplication technology today and tomorrow - Pretty geeky but an important technology in storage space.
What 10 things should you do every day to improve your life? - Good Article.
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