Statistical independence is a fundamental concept in quantitative finance that describes the absence of any predictive relationship between two events or variables. When events are truly independent, knowing the outcome of one provides no information about the other.

In trading, understanding independence is crucial for building robust diversification strategies, conducting accurate risk assessments, and avoiding common behavioral biases that can lead to poor investment decisions.

Independence differs significantly from correlation and cointegration - while correlation measures linear relationships and cointegration captures long-term equilibrium relationships, independence implies a complete absence of any statistical connection.