I am intrested in trading pairs of stocks. The first step I have taken is to create a spread series between the 2 stocks. However it makes a difference if you create the spread series as Stock1/Stock2 or Stock2/Stock1 ie: if you apply any sort of model using the spread series you get results that are different depending on whether you calculate it as Stock1/Stock2 or Stock2/Stock1. Does anyone have experience of t his? is ther a better way of expressing the spread relationship than by simple division of the 2 series?

QUOTE:
I am intrested in trading pairs of stocks. The first step I have taken...

Here's a better start:
1. Search for terms like pair, pairs, pair trad, spread, etc. using the Search button; this will bring up a lot of discussions (both in these forums as well as in WL4 forums) for you to study and learn from.
2. Look at the published pair trading scripts; for WL.NET, they should be available via the Strategy Explorer; for the older WL4 format scripts, go here: http://wl4.wealth-lab.com/cgi-bin/WealthLab.DLL/getpage?page=ChartScriptFamilies.htm and click on Pairs Trading.

Just a small additional note. My suggestion to lookup existing scripts was to save you time so you don't have to start from scratch and could learn from what other traders have done; it was *not* to suggest that the existing pair trading scripts are robust or are recommended.

Good luck.