Identifying Pairs Trading Strategy in Hedge Funds

John is an investment analyst at a hedge fund that specializes in relative value strategies. He recently analyzed a pair of stocks, Stock A and Stock B, which are in the same industry but have diverging price movements. He believes that Stock A is undervalued in comparison to Stock B and decides to create a trade based on this analysis. John plans to go long on Stock A and short on Stock B, anticipating that the prices will converge over time.

Given this scenario, which of the following best describes John's trading strategy?