Correlation: 0.70 · Cointegrated: yes
Z-score: -1.20 entry / -1.89 rolling
Half-life 1.2h · Hurst 0.87 · Hedge ratio 0.24
Pair volatility: 30.53%
Backtest: 65.22% win · Sharpe 0.01 · -0.01% return · 2.40% max drawdown
Pair Analysis: Long LINEA / Short SAND
- Roll Z-Score: -1.94 (1h) / -1.58 (4h)
- Correlation: 0.70 (1h)
- Cointegration: True (1h/4h)
- Half-Life: 29h (1h)
- Hedge Ratio: 0.244 (1h)
Analysis:
- Mean Reversion: The negative z-score (-1.94) indicates that LINEA is currently statistically "cheap" relative to SAND on a 1h basis. The trade setup (Long LINEA / Short SAND) is aligned with a mean-reversion strategy, betting that the spread will widen back toward the mean.
- Sentiment Context: Both assets are currently facing bearish sentiment. LINEA is under pressure from an upcoming large token unlock, while SAND continues to struggle with a long-term downtrend and waning speculative interest.
- Risk Note: While the statistical setup is favorable for mean reversion, the shared bearish sentiment suggests a "race to the bottom" dynamic. The trade relies on LINEA outperforming (or falling less than) SAND, rather than a fundamental bullish catalyst for LINEA.
- Execution: Both assets are available on Hyperliquid (Core). Ensure sufficient USDC collateral is available.
LINEA
SAND