Pair is strongly reverting towards the mean with accelerating velocity and stable volatility.
Regime: STRONG_REVERSION (high confidence)
Correlation: 0.77 · Cointegrated: yes
Z-score: -3.48 entry / -2.19 rolling
Half-life 2.5h · Hurst 0.85 · Hedge ratio 1.28
Pair volatility: 29.96%
Backtest: 68.00% win · Sharpe -0.14 · -0.16% return · 2.06% max drawdown
Pair Analysis: Long YGG / Short ZEN
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Roll Z-Score: -2.19 (1h), -3.71 (4h), -1.73 (1d).
- Interpretation: The negative z-scores indicate YGG is statistically "cheap" relative to ZEN. The 4h z-score of -3.71 suggests a significant deviation, supporting a mean-reversion setup where YGG outperforms ZEN.
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Correlation: 0.77 (1h), 0.73 (4h), 0.44 (1d).
- Interpretation: Strong short-term correlation (1h/4h) supports the pair's validity for mean reversion, though the 1d correlation is weaker, suggesting the relationship is more reliable on intraday timeframes.
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Sentiment:
- YGG: Bearish. Sentiment is weighed down by the shutdown of its game publishing arm and ongoing token unlocks.
- ZEN: Bearish. Entrenched bearish momentum and persistent underperformance relative to the broader market.
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Trade Remark: This is a relative-value trade between two bearish assets. You are betting that YGG's structural headwinds are already priced in (or that ZEN's momentum is more exhausted), allowing YGG to recover or hold up better than ZEN. The 4h z-score (-3.71) provides a strong statistical signal for this entry, but the bearish sentiment on both legs suggests limited upside; monitor for further structural deterioration in YGG.
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Tradeability: Both assets are listed on Hyperliquid (YGG: 3x max leverage, ZEN: 5x max leverage).
YGG
ZEN