Share you Pairs

here's a great pair to hedge and profit over a few hours
(disclaimer not foolproo)

EUR/CAN

GBP/JPY


A great set of hedge pairs given EUR srength and GBP weakness .... these pairs rock..

this willl change as days and economic release comes out ... but for now its a great tradeing hedge set up.

Although I gotta say ... hang on to your hat .. these 2 pairs can scream ....

Rocket,

Would you mind saying more about why you use these two pairs to hedge? They don't correlate at all.

GBPJPY/EURCAD 5 day correlation: 02+
GBPJPY/EURCAD 20 day correlation: 44-
GBPJPY/EURCAD 100 day correlation: 37-
(strong correlation/reverse correlation is 80+/80- or higher)
--> see http://www.mataf.net/en/analysis-correlation.htm

I'm an absolute novice at hedging, and quite a beginner at trading, but I always thought that one chooses pairs to hedge that closely correlate.

Is there something I'm missing? (more than possible =))

J

yes, I see what you mean with your 100 day correlation ... what I referred to was intra day corrrelation even hourly ... not easy to quantify except by observation. Seeing I was in both pairs together I followed them working together like rubber bands .... both where very volatile and in my account balanced against each other amazingly over several hours.

And with the news releases over the past week they are reacting at opposites, ranging, while being volatile at opposites..

Cant say it was scientific at all ....., but was observable...


I was having a great time with these pairs and usually trade GBY/JPY intra day with good success.