Mate, I appreciate that you're running an advise business, but I think you may need to explain how you "know" when something is diverging and not comming back. None of this stuff is easy, nor a sure thing, and the quant competiton out there is lot more than some dude looking at correlation & a ratio using off the shelf tools.
I don't know how anyone could consistently trade a two-legged futures spread for mean reversion since the year 2006, mate. We model for diversion. In terms of "knowing", well, if you need to deal in absolutes you are in the wrong business. If you doubt otherwise, by all means, keep on doing what you're doing as it must be working swimmingly for you.
There has been more broad correlation over the past 3 years than ever before. Divergence, and dispersion have been a mug punterâs bet. Not hard to measure. Anyone who believes otherwise is lazy, a moron, or selling something without efficacy.
Well, maybe someone else can post something constructive and informational for a change - the sniping and ankle biting is easy. Maybe one of the bomb throwers would like to be helpful, perhaps ?
well i guess i'll put myself forward as an easy target - got out of my 'sure thing' soybeans with only 6 tics grace on the realisation the whole damn curve was shifting to contango and im on the wrong side! me and my big mouth..... still, tiny profit always better than a loss.....
I've been long March 12 Wheat and short July 12 Wheat for going on three full weeks now. Agree about getting too cocksure about markets - they always find a way to remind us of our foibles.