IRB - LT Pair Analysis

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End-of-day divergence (Standardized residual) is -0.787.
Half life of pair is 6.69.
Real time (live) divergence is calculating using following formula:
[lt_price - (5.36 * irb_price) - 6.05]/79.5

(where 6.05 is mean error and 79.5 is standard error)
Technical strength of IRB is 7.3. (Support & Resistance)
Technical strength of LT is 7.3. (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 2.0 or less than -2.0. 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 irb-lt.
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

IRB Futures - NSE
Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
April 26, 2018 265.15 14212500.0 4520.0 5677.0 264.45
May 31, 2018 266.55 4002500.0 1321.0 2129.0 264.45
Lot size: 2500.0.

LT Futures - NSE

Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
April 26, 2018 1354.55 14378250.0 5377.0 6706.0 1360.0
May 31, 2018 1360.9 1872000.0 2169.0 3166.0 1360.0
June 28, 2018 1378.4 6000.0 2.0 2.0 1360.0
Lot size: 750.0.
Click here for backtesting results.

IRB-LT Analysis with different time frames and thresholds

Time Frame 1month, Entry Threshold 1.5, Stop Loss Threshold 2, Total Profit 45813.4781843
Time Frame 1month, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 42262.2957279
Time Frame 6months, Entry Threshold 1.5, Stop Loss Threshold 2, Total Profit 22601.8092449
Time Frame 6months, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 21049.2998665
Time Frame 1month, Entry Threshold 2, Stop Loss Threshold 2.5, Total Profit 7092.0116536