Concept

Pair Trading lets you trade the relative performance of two assets instead of betting on the absolute direction of one asset.

Instead of asking: “Will BTC go up?”

Pair trading asks: “Will BTC outperform ETH?”

Concept (Relative Value Trading)

A pair trade is typically expressed as:

• Long A / Short B (you expect A to outperform B)
• Short A / Long B (you expect B to outperform A)

This approach is often used to:

• Trade rotations between narratives
• Express macro views (e.g., risk-on vs risk-off assets)