Algorithmic Trading: LONG-SHORT EQUITY Trading Strategy in PYTHON
In this video we'll see how to implement in Python a simplified version of one of the most popular strategies in Algorithmic Trading: the Long-Short Equity Strategy.
From Investopedia.com:
Long-short equity is an investing strategy that takes long positions in stocks that are expected to appreciate and short positions in stocks that are expected to decline. A long-short equity strategy seeks to minimize market exposure while profiting from stock gains in the long positions, along with price declines in the short positions. Although this may not always be the case, the strategy should be profitable on a net basis.
The long-short equity strategy is popular with hedge funds, many of which employ a market-neutral strategy, in which dollar amounts of both long and short positions are equal.
Chapters:
00:00 - Introduction
00:50 - Daily Returns
03:08 - Stock Allocation
07:51 - Strategy Returns
09:46 - Sharpe Ratio