CASTROLIND - IDBI Pair Analysis

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End-of-day divergence (Standardized residual) is 1.46.
Half life of pair is 5.37.
Real time (live) divergence is calculating using following formula:
[idbi_price - (0.299 * castrolind_price) - -0.00976]/3.05

(where -0.00976 is mean error and 3.05 is standard error)
Technical strength of CASTROLIND is 1.7. (Support & Resistance)
Technical strength of IDBI is 5.3. (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 castrolind-idbi.
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

CASTROLIND Futures - NSE
Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
January 25, 2018 187.8 20280400.0 792.0 1089.0 187.75
February 22, 2018 188.85 2870000.0 293.0 555.0 187.75
Lot size: 2800.0.

IDBI Futures - NSE

Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
January 25, 2018 60.6 29350000.0 1004.0 1075.0 60.55
February 22, 2018 60.95 5510000.0 204.0 236.0 60.55
March 28, 2018 61.0 140000.0 1.0 1.0 60.55
Lot size: 10000.0.
Click here for backtesting results.

CASTROLIND-IDBI Analysis with different time frames and thresholds

Time Frame 6months, Entry Threshold 2, Stop Loss Threshold 3, Total Profit 29513.6746951
Time Frame 6months, Entry Threshold 1.5, Stop Loss Threshold 2, Total Profit 28031.0048778
Time Frame 6months, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 21423.2810507
Time Frame 6months, Entry Threshold 2, Stop Loss Threshold 2.5, Total Profit 14435.4815614
Time Frame 3months, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 13713.4049642