I'd like to get some feedback on a pair that I'm looking at. Long JOE, Short SPY
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JOE is a real estate company in Florida which saw a big hit to its stock price as a result of the BP oil spill. However, the company has recently announced that it has not seen a significant impact as a result of the crisis AND has taken precautionary measures to ensure that any impact is mitigated.
Pairing it against the market looks pretty favorable. JOE has decreased at a higher rate than the market, and I think it may increase at a higher rate as things settle down with regards to the oil spill.
It's trading significantly away from the mean and should converge within a few weeks.
What do you guys think?
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JOE is a real estate company in Florida which saw a big hit to its stock price as a result of the BP oil spill. However, the company has recently announced that it has not seen a significant impact as a result of the crisis AND has taken precautionary measures to ensure that any impact is mitigated.
Pairing it against the market looks pretty favorable. JOE has decreased at a higher rate than the market, and I think it may increase at a higher rate as things settle down with regards to the oil spill.
It's trading significantly away from the mean and should converge within a few weeks.
What do you guys think?
