Perspective

Apr., 2012

Pairs Trading

Stephen Grahling
Head of Event Driven Sector Trading, Bank of America Merrill Lynch

Which electronic algorithms can be used to trade relative valuation opportunities or manage risk in a pending corporate action?

The Bank of America Merrill Lynch Pairs Algorithm Suite supports a variety of complex trading strategies that are based on the share-price relationships of 2 stocks. Paired names involved in a corporate action can be traded as well as names with an established statistical relationship or where a relative price movement is anticipated.

The Pairs Algorithm Suite leverages Bank of America Merrill Lynch's intelligent smart order router and a low latency infrastructure that enables the algorithms to act on eeting trade opportunities when trading the paired stocks simultaneously.

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