POWERGRID - YESBANK Pair Analysis

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End-of-day divergence (Standardized residual) is 1.71.
Half life of pair is 17.1.
Real time (live) divergence is calculating using following formula:
[yesbank_price - (7.18 * powergrid_price) - -3.06]/105

(where -3.06 is mean error and 105 is standard error)
Technical strength of POWERGRID is 6.7. (Support & Resistance)
Technical strength of YESBANK is 6.7. (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 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 powergrid-yesbank.
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

POWERGRID Futures - NSE
Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
August 31, 2017 220.7 11024000.0 859.0 904.0 220.7
September 28, 2017 219.1 380000.0 33.0 33.0 220.7
Lot size: 4000.0.

YESBANK Futures - NSE

Expiry Date Close Price Open Interest Number of Trades No of Contracts Underlying Closing Price
August 31, 2017 1768.8 8772400.0 15396.0 18030.0 1761.85
September 28, 2017 1777.6 219800.0 309.0 373.0 1761.85
October 26, 2017 1777.35 13300.0 4.0 4.0 1761.85
Lot size: 350.0.
Click here for backtesting results.

POWERGRID-YESBANK Analysis with different time frames and thresholds

Time Frame 1month, Entry Threshold 1.5, Stop Loss Threshold 2.5, Total Profit 35632.0928928
Time Frame 1year, Entry Threshold 2, Stop Loss Threshold 2.5, Total Profit 31985.3702686
Time Frame 1month, Entry Threshold 1.5, Stop Loss Threshold 2, Total Profit 30490.3979197
Time Frame 1year, Entry Threshold 2, Stop Loss Threshold 3, Total Profit 13678.9881102
Time Frame 3months, Entry Threshold 1.5, Stop Loss Threshold 2, Total Profit 13410.5844453