i second that, i will post what a i heard from a deutsche bank fund manager that overlooked one of their long/short equity strategies that had an impressive track record during 10 years (in which i had money), while all the sudden began run south by the time LEH event took place and never recouped the losses ever since. according to him, those models were created in a macroeconomic context that no longer prevail. the imbalances in world's economy altered the dynamics governing price valuation and thus the edge in those strategies disappeared. he hinted it has to do a eventual shift to a deflationary world in which the wealth destruction is far greater than the amount of fresh money printed by the central banks to keep the economy afloat. this is just PR BS from a DB manager but anyway, is what they come up with in 2009. to be honest, i agree with him when it comes to weigh the influence of inflation or other important economic trends in price dynamics.
I heard it on Fox Business and I read it on the Internet...It must be true....no? I think a gold salesmen will confirm it also...while he is snake-oiling the latest and greatest gold coin find just released.. My research is most complete. And my sources are impeccable.. What? ES
Not sure what you are talking about with your paired trading but... You have lots of people, doing everything that can be thought of to get an edge. You used to trade the week, then the day, now people are trading the tick. Things that use to work in the past, don't because market participants are responding to a different information set.
I have a lot of respect for you Nitro, you get me thinking. I have found it interesting, especially more recently, the correlation of the market and currencies. I do believe also that we are experiencing a shift for more local economies to international economies. It's the only thing that seems to make sense.