ASIANPAINT - GODREJCP Pair Analysis

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End-of-day divergence (Standardized residual) is 1.92.
Half life of pair is 6.79.
Real time (live) divergence is calculating using following formula:
[godrejcp_price - (0.814 * asianpaint_price) - 0.531]/39.9

(where 0.531 is mean error and 39.9 is standard error)
Technical strength of ASIANPAINT is 1.9. (Support & Resistance)
Technical strength of GODREJCP is 7.5. (Support & Resistance)
Recommendation
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Entry Criterion: Take positions when divergence becomes (+/-)2.0. And exit positions when divergence becomes (+/-)0.0.
Stop Loss: Put your stop loss when divergence becomes more than 3.0 or less than -3.0. We suggest you always use stop losses.
Note: When you trade in futures, keep in mind the expiry date of futures as divergence might not end before expiry date.
Click here to see all recommendations for pair asianpaint-godrejcp.
Analyse any other pair:

How to choose pairs?
Choose stocks from same sector/subsector.
Use stock with large market capitalization as first stock.
Here is a list of pairs chosen analytically.

Charts

ASIANPAINT Futures - NSE
Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
December 28, 2017 1123.45 3659400.0 1452.0 1496.0 1118.7
January 25, 2018 1128.6 76800.0 50.0 60.0 1118.7
Lot size: 600.0.

GODREJCP Futures - NSE

Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
December 28, 2017 991.55 1676800.0 848.0 893.0 987.6
January 25, 2018 995.7 12800.0 4.0 4.0 987.6
Lot size: 800.0.
Click here for backtesting results.

ASIANPAINT-GODREJCP Analysis with different time frames and thresholds

Time Frame 1year, Entry Threshold 2, Stop Loss Threshold 3, Total Profit 133828.014696
Time Frame 1month, Entry Threshold 1.5, Stop Loss Threshold 2, Total Profit 116279.597026
Time Frame 1month, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 114478.141565
Time Frame 3months, Entry Threshold 2, Stop Loss Threshold 3, Total Profit 105408.37504
Time Frame 3months, Entry Threshold 2, Stop Loss Threshold 2.5, Total Profit 99683.8565968