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

Pair of the Day

• Pair: LLTC - SMH
• Sector: Stock vs ETF (Semiconductor)
• Spread: 1.25
• Current Distance from Mean: 0.42
• Correlation: 0.98
• Spread range: 1.40 - 1.60

By now I hope you are pleased that we gave you the extra heads up again on GG-ABX which worked out brilliantly yesterday. We remain long half the pair as evidenced in the portfolio section below. Let's see if a small "trend" can develop here to take the spread to 0.25 or higher. We'll keep you posted.

So, this is a similar situation where we are again showing a pair that we have featured and traded recently. The last time we mentioned this pair in Pair of the Day you'll note that we mentioned 1.23 as a recent "body" high in the pair. With the spread closing yesterday at 1.25 our ears have perked up again for a possible re-short. Note the area in the distance from the mean indicator that we have circled. That historical high circled area is 0.60 away from the mean which would translate into about 1.43 on the spread.

Be aware of how the pair trades coming into the range. Remember that a big intraday expansion of range may indicate that the pair wants to trend up to another area and would make us pass on it. Yesterdays daily bar was large but not an outlier by any means.

Pairs Trader Portfolio

The matrix below shows all current ShadowTrader Pro Pairs Trader trades in the Portfolio. The Portfolio contains only those plays that are sent out in real-time via email. The Pair of the Day setup above is not 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. Current open positions are on top, with positions that were closed in the current calendar week on the bottom. Closed positions are moved out of the matrix on Monday mornings 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, read our Pairs Trader User's Guide

OPEN POSITIONS - week of 6/21 - 6/25
pair	dir	sizes	date entered	entry spread	date closed	exit spread	target	stop	status	mark to market	p&l points	p&l capital	capital commit
GG - ABX	long	65, 63	06/23	-0.84	n/a	n/a	1.25	-1.25	open	-0.03	0.81	$53	$5,621
	Sold half position at 0.01, see below
CLOSED POSITIONS - week of 6/21 - 6/25
sym	dir	size	date entered	entry spread	date closed	exit spread	target	stop	status	mark to market	p&l points	p&l capital	capital commit
LLTC-SMH	short	171, 177	06/16	0.94	06/22	0.65	n/a	n/a	closed	n/a	0.29	$51	$9,967
	Closed at target
GG - ABX	long	50, 50	06/23	-0.84	06/23	0.01	n/a	n/a	closed	n/a	0.85	$43	$5,621
	Closed 50 shares of each for solid gain
	TOTALS:	128	open shares (open capital committed doesn't include closed trades)										$5,621

Click here for year to date Pairs Trader Performance - 2010

Click here for year to date Pairs Trader Performance - 2009

All content © 2010 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, designed as supplemental material for the ShadowTraderPro Newsletter subscription service and it is not intended to be a stand alone newsletter. 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.