Another Cool Financial Tool

Written by Norm Winer. Follow me on Twitter and StockTwits

On October 14, @fledglingtrader left a comment on our blog in response to a short piece we wrote about a UTX-GE spread we put on earlier in the month. @fledglingtrader referred us to the website Catalystcorner. Catalyst Corner provides free research reports on companies with significant milestones or catalysts on the horizon that have potential to move the stock.

Additionally, the site has created a tool for analyzing pair trades, which it also provides free of charge. The user can create a pair trade by choosing a long stock, a short stock, and a long dollar amount. The pair trading tool then generates a one-page fact sheet that contains the number of shares to buy and sell, a basic comparison of the two stocks’ fundamentals, a statistical analysis of the behavior of the pair over the user-defined time period, and four graphs showing price history and moving averages. In addition, the site provides a twelve-page e-book introduction to pair trading in PDF format. This tool provides the user with a quick and handy means for evaluating pair trades. In fact, we’ve already used the pair trading tool to analyze two new trades we are contemplating.

You might want to start using this tool to exploit rich opportunities available in trading spreads.