NIFTY - MOTHERSUMI Pair Analysis

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End-of-day divergence (Standardized residual) is 0.978.
Half life of pair is 5.77.
Real time (live) divergence is calculating using following formula:
[mothersumi_price - (0.0353 * nifty_price) - 0.0537]/11.3

(where 0.0537 is mean error and 11.3 is standard error)
Technical strength of NIFTY is 7.5. (Support & Resistance)
Technical strength of MOTHERSUMI is 7.7. (Support & Resistance)
Recommendation
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Entry Criterion: Take positions when divergence becomes (+/-)1.5. And exit positions when divergence becomes (+/-)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 nifty-mothersumi.
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

NIFTY Futures - NSE
Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
December 28, 2017 10359.5 19738650.0 72979.0 137094.0 10333.25
January 25, 2018 10392.1 923925.0 5102.0 7435.0 10333.25
February 22, 2018 10423.8 162450.0 1205.0 1533.0 10333.25
Lot size: 75.0.

MOTHERSUMI Futures - NSE

Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
December 28, 2017 376.05 12573750.0 1533.0 1585.0 375.9
January 25, 2018 378.15 276800.0 60.0 61.0 375.9
Lot size: 3750.0.
Click here for backtesting results.

NIFTY-MOTHERSUMI Analysis with different time frames and thresholds

Time Frame 1month, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 18883.602564
Time Frame 1month, Entry Threshold 1.5, Stop Loss Threshold 2, Total Profit 14833.8047712
Time Frame 1month, Entry Threshold 2, Stop Loss Threshold 2.5, Total Profit 4709.29445538