Statistical Arbitrage

Forex and trading related articles under the following category: Statistical Arbitrage

Statistical Arbitrage: a Quantitative Trading Strategy - How does it work?

2025-Apr-11

Statistical arbitrage, often abbreviated as stat arb, is a sophisticated form of algorithmic trading that seeks to exploit short-term pricing inefficiencies between correlated financial instruments. Rooted in statistical and mathematical models, this strategy identifies temporary divergences in asset prices from their expected behavior, aiming to profit from their eventual convergence.