Pair trading in fixed income is not popular, at least not on #fintwit. We will try to shed some light on this strategy with an example that we like. But let’s start with a brief explanation of what exactly is pair trading. In its simplest form it means buying symbol A vs shorting symbol B and holding for the spread between the two to narrow. Here comes the tough part – the spread can be measured in multiple ways and at times a different ratio of long vs short is required.