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Showing posts from July, 2011

Hedge and Correlation Strategy

There are 5 Simple Steps to the new “Going Home Trading Method", formerly known as the “Hedging and Correlation” Method. We are still hedging and correlating, just that the new name will help us visualize what we are wanting to accomplish in this trading system, and we have modified our entries and exits after a very long time of practicing. Most pairs that are positively correlated above 75% "live” below the 20-25% “difference” line on our one indicator that we use (see below—thanks to SMJones for developing it!). This is their home. Sometimes they will travel a little ways away from home (like up to 50%) and occasionally they will make a long trip (over 80%). But of course “there’s no place like home” so they eventually return to under 20%, where they live most of the time. We will open trades when the pairs are away on a trip, helping them to get back home, and we will profit on the way back. There are only 5 steps to trading this successfully: 1. Go to  http://ww