CIPLA - TATAMTRDVR Pair Analysis

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End-of-day divergence (Standardized residual) is -0.0913.
Half life of pair is 2.17.
Real time (live) divergence is calculating using following formula:
[tatamtrdvr_price - (0.394 * cipla_price) - 0.0621]/5.71

(where 0.0621 is mean error and 5.71 is standard error)
Technical strength of CIPLA is 2.1. (Support & Resistance)
Technical strength of TATAMTRDVR is 1.7. (Support & Resistance)
Recommendation
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Entry Criterion: Take positions when divergence becomes (+/-)1.5. And exit positions when divergence becomes (+/-)0.0.
Stop Loss: Put your stop loss when divergence becomes more than 2.5 or less than -2.5. 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 cipla-tatamtrdvr.
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

CIPLA Futures - NSE
Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
December 28, 2017 578.6 9353000.0 3704.0 3978.0 576.45
January 25, 2018 580.7 133000.0 109.0 110.0 576.45
Lot size: 1000.0.

TATAMTRDVR Futures - NSE

Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
December 28, 2017 226.8 25542300.0 847.0 887.0 226.5
January 25, 2018 228.3 935000.0 129.0 129.0 226.5
February 22, 2018 229.55 12500.0 1.0 1.0 226.5
Lot size: 2100.0.
Click here for backtesting results.

CIPLA-TATAMTRDVR Analysis with different time frames and thresholds

Time Frame 3months, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 50078.528159
Time Frame 3months, Entry Threshold 1.5, Stop Loss Threshold 2, Total Profit 44034.3531871
Time Frame 6months, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 27327.5134332
Time Frame 6months, Entry Threshold 2, Stop Loss Threshold 3, Total Profit 23084.3814261
Time Frame 6months, Entry Threshold 2, Stop Loss Threshold 2.5, Total Profit 10797.2915187