NAAIM 2026 Founders Award Presented to Davide Pandini, Italian
Financial Analyst and Technical Director of STMicroelectronics
Littleton, Colorado – April 27, 2026 – The National Association of Active Investment Managers (NAAIM) has named Davide Pandini, PhD, CMT, MFTA, CFTe, CSTA, the 2026 winner of its annual white paper competition, the NAAIM Founders Award. Dr. Pandini is a Technical Director in semiconductor technology at STMicroelectronics in Agrate Brianza, Italy, and an award-winning financial analyst and researcher. His paper, titled “Stationary, But Not Profitable? A Critical Look at Pairs Trading,” asks whether traditional measures of long-run equilibrium – specifically stationarity and cointegration – remain reliable predictors for successful pairs trading in today’s market conditions.
“This research seeks to bridge the gap between theoretical econometrics and practical investing and trading execution in a regime characterized by high volatility clusters and structural shifts,” Dr. Pandini explains. In doing so, the study introduces a fully reproducible, end-to-end framework for spread-based trading. “The results present what we call the ‘Cointegration Paradox’: while cointegration is a standard for risk management, it is neither a sufficient nor a strictly necessary condition for profitability,” he says.
Originally developed in the 1980s, pairs trading assumes two stocks with similar trading patterns and returns in the past will exhibit the same relationship or cointegration in future markets. Thus, if prices diverge, traders anticipate future convergence or mean reversion by shorting the overvalued stock and going long the undervalued one. In his research paper, Dr. Pandini asks whether pairs trading is still a valid strategy given more than 40 years of market evolution.
Among the conclusions of the paper is that in-sample cointegration is not a strict prerequisite for out-of-sample profitability. Short-horizon mean-reversion rules can exploit transient, regime-dependent corrections in relative prices without requiring a perfectly stationary spread. The lack of cointegration, however, implies drift risk (non-stationarity); hence, rigorous risk control is essential in contemporary pairs trading, according to Dr. Pandini. His paper also establishes that multi-asset combinations can effectively filter idiosyncratic risk to preserve a stable common stochastic trend.
“A key point the paper makes is its explicit modeling of transaction costs,” said NAAIM President Barry Arnold. “Dr. Pandini demonstrates that execution efficiency can be as important as statistical modeling. A modest 10 basis point cost can significantly reduce the Sharpe ratio in high turnover strategies. I also appreciated his discussion of ‘drift risk’ in commodity-linked pairs, making them less suitable for traditional pairs trading.”
Dr. Pandini will present his Founders Award paper at the National Association of Active Investment Managers annual Uncommon Knowledge Conference on Wednesday morning, April 29, 2026, at the Tampa Westin Waterside in Tampa, Florida. For information on the conference, visit www.naaim.org. To download the full paper, visit: https://naaim.org/wp-content/uploads/2026/04/Stationary-But-Not-Profitable-A-Critical-Look-at-Pairs-Trading-2026-Davide-Pandini-PhD.pdf
The NAAIM Founders Award, established in 2009, aims to promote knowledge of active investment management by inviting and publishing research about active strategies and their outcomes. Over the past 17 years, the competition has taken on an international flavor with winners from Australia, Germany and now Italy. Among the competitors in 2026 were submissions from India.
Davide Pandini, PhD, CMT, MFTA, CFTe, CSTA
Davide Pandini holds a master’s degree in Electronics Engineering (summa cum laude) from the University of Bologna (Italy) and a PhD in Electrical and Computer Engineering from Carnegie Mellon University, Pittsburgh. In 1995, he joined STMicroelectronics in Agrate Brianza (Italy), a leading European semiconductor Integrated Device Manufacturer (IDM) company, where he is a Technical Director and Fellow of STMicroelectronics Technical Staff. Since June 2015, he has been the chairman of the ST Italy Technical Staff.
Dr. Pandini has earned the CMT, MFTA and CFTe designations, and is a professional member (CSTA) of SIAT (Società Italiana di Analisi Tecnica), a member society of the International Federation of Technical Analysts (IFTA), a global organization of market analysis societies and associations. In 2021, he received the XII SIAT Technical Analyst Award in the Open category, and the IFTA John Brooks Memorial Award. He was a speaker at the IFTA 2023 and 2024 annual conferences, the Bogu International Investment Forum 2024 in China, and the Open Source Quantitative Finance 2025 conference in Chicago. His work has been published in the Journal of Technical Analysis and the IFTA Journal. He serves on the SIAT Scientific Committee and on the IFTA Board of Directors.
About the NAAIM FOUNDERS AWARD:
Launched in 2009, the NAAIM Founders Award is designed to expand awareness of active investment management techniques and the results of active strategies through the solicitation and publication of research on active management. $5,000 is presented annually for the best paper submitted to the competition. Prior entries to the competition can be found on the NAAIM website at https://naaim.org/programs/find-a-whitepaper/
The National Association of Active Investment Managers (NAAIM) is a non-profit trade group of more than 125 member firms nationwide, collectively managing in excess of $22 billion. NAAIM’s purpose is to promote the common interests of those investment advisors who provide active investment management services to clients. NAAIM’s many professional development opportunities are headlined by its annual conference – Uncommon Knowledge – held each spring in locations around the U.S. For more information, visit www.naaim.org
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