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The ShadowTraderPro Pairs Trader is a daily report which spotlights one equity pair which trades in a definable range and whose stocks are positively correlated. The objective of the newsletter is to present one such pair daily that may be coming into play currently, giving self-directed traders the opportunity to put the pair on watch for possible entry. Additionally, Pairs Trader sends out specific trade recommendations on selected equity pairs. These trades are managed actively via real-time email alerts and are tracked in the Pairs Trader Portfolio.

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If you are totally new to Pairs Trading, please take a look at this short video START HERE

If you have any questions or comments regarding commentary or plays in this newsletter, please email to pairstrader@shadowtrader.net.

Pair of the Day

  • Pair: EQR-BRE
  • Sector: Real Properties
  • Spread: 11.86
  • Current Distance from Mean: 0.99
  • Correlation: 0.98
  • Spread Range: 11.00 - 12.00

Equity Residential & Bre Properties are setting up for a nice short entry for you wild mavericks out there. The technicals are looking to call the pair back to the mean but the entry may be a little tricky for the novice traders. Let's see if the pair retracts or if it continues to go on up a little bit more. If the pair gives us a small green candle tomorrow and holds up into resistance, then I should be able to add this pair to our pending trades for Tuesday's newsletter....We shall see....

Notice that we went ahead and put NEM-ABX back into the pending files as the pair should still offer us a nice long entry. We look forward to your questions, comments and suggestions and for anyone still needing the "Pairs Correlation Set Up" please email me at pairstrader@shadowtrader.net. "Monday, Here We Come!"

Wizard Lab

Below are the Wizard Lab (.wiz) files needed for all of the current Pending Trades in the Model Portfolio below. Right click on the links below and save to your local computer. You can then import the strategies into Wizard Lab on your Prodigio Platform. Detailed instructions are in our Pairs Trader User's Guide here.




STRATEGY - Pairs XLNX-LLTC (buy).wiz

STRATEGY - Pairs XLNX-LLTC (sell).wiz

STRATEGY - Pairs UDR-CLP (buy).wiz

STRATEGY - Pairs UDR-CLP (sell).wiz

STRATEGY - Pairs NEM-ABX (buy).wiz

STRATEGY - Pairs NEM-ABX (sell).wiz

Pairs Trader Portfolio

The matrix below shows all current ShadowTrader Pro Pairs Trader trades in the Portfolio. The Portfolio is divided into three sections: Pending Trades, Open Trades, and Closed Trades. A 'Pending Trade' is one for which the .wiz files have been provided above, and is actively deployed in Prodigio, waiting for its spread value to trigger an entry. An 'Open Trade' is one which has fired and is actively being managed by Prodigio. 'Closed Trades' are those whose target or stop has been hit. Anytime that a new trade is entered, or any changes to existing trades are made, this information is posted live, in real time, on MyTrade.


The Pair of the Day setup above should not be assumed to be actively managed or or tracked. Appearance of a pair in Pair of the Day does not guarantee that the pair will be in play in the Portfolio at any time. Please check Open Trades section below for newly deployed pairs strategies that are waiting for spread entry. Closed trades are moved out of the matrix on Monday evenings and posted in our performance page here.


To get the most out of your subscription and for detailed instructions on how to structure your own portfolio, and use Prodigio to automate your pairs trading, read our Pairs Trader User's Guide


PENDING TRADES - week of 08/08 - 08/12
pair dir size date
entered
entry
price
date
closed
exit
price
target stop status mark
to
market
p&l
points
p&l
capital
capital
commit
XLNX-LLTC short 169,186 8/10 3.74 n/a n/a mean 4.50 pendg n/a n/a n/a $10,014
  Let's keep this pair short for now and let Prodigio look for a short entry on this pair around the $3.74 level... ..
UDR-CLP long 218,265 8/11 3.64 n/a n/a mean 2.75 pendg n/a n/a n/a $9,988
  Looking for a long entry with Prodigio for this pair around the 3.64 area. ..
NEM-ABX long 87,101 8/15 6.77 n/a n/a mean 5.50 pendg n/a n/a n/a $10,003
  The pair is back with both stocks showing as (ETB) Easy-to-borrow. ..
OPEN TRADES - week of 08/08 - 08/12
pair dir size date
entered
entry
price
date
closed
exit
price
target stop status mark
to
market
p&l
points
p&l
capital
capital
commit
BHP-BBL long 62,77 8/05 15.30 n/a n/a mean 14.00 open 15.15 (0.15) ($29) $9,875
  The pair now has a new target mean of $15.57 from Friday's close. We will be watching the pair for the most profitable exit.
ClOSED TRADES - week of 08/08 - 08/12
pair dir size date
entered
entry
price
date
closed
exit
price
target stop status mark
to
market
p&l
points
p&l
capital
capital
commit
WRI-KIM long 213,285 8/04 5.95 8/08 4.98 n/a n/a closed n/a (0.97) ($22) $9,972
  Prodigio closed the pair Monday afternoon after the pair finally gave up and fell through our stop. All in all the pair gave a good fight in this very volatile market.
ADSK-ADBE long 169,201 8/05 4.75 8/09 4.95 n/a n/a closed n/a 0.20 $49 $9,960
  Prodigio closed the pair after falling through our trailing stop of $5.00 for a nice gain on Tuesday...; )
TOTALS: 139 open shares (open capital committed doesn't include closed trades) $9,875.00

Click here for year to date Model Portfolio Performance - 2011

Click here for Model Portfolio Performance - 2010

Click here for Model Portfolio Performance - 2009

All content © 2011 by ShadowTrader Technologies, LLC. All rights reserved.

Disclaimer and Waiver of Claims: Disclaimer and Waiver of Claims: The ShadowTraderPro Pairs Trader is a newsletter service and it is not intended as trading advice or recommendation. The risk of loss in the trading of any securities products can be substantial. The strategies mentioned here are active trading strategies, therefore you should carefully consider whether such trading is suitable for you in light of your personal investment objectives and financial resources. This material is for information purposes only and should not be construed as an offer or solicitation of an offer to buy or sell any securities. Past performance of any trades mentioned never guarantees future results.

Securities and options involve risk and are not suitable for all investors. See the characteristics and risks of standardized options.