What Does Arbitrage Mean?


Arbitrage means simultaneous purchase and sale of an asset in order to profit from a difference in the price.
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Ask.com Answer for: what does arbitrage mean
[ahr-bi-trahzh for 1, 3; ahr-bi-trij for 2]
Finance. the simultaneous purchase and sale of the same securities, commodities, or foreign exchange in different markets to profit from unequal prices.
Archaic. arbitration
Finance. to engage in arbitrage.
Source: Dictionary.com
Q&A Related to "What Does Arbitrage Mean"
Basically if you buy an item for say $10 in one arena and sell if for $20 in a different arena, you just made $10. You may say arbitrage but I'll just call it profit.
Ask.com's definition. The purchase of securities on one market for immediate resale on another market in order to profit from a price discrepancy. In investment terms, arbitrage trading
1. Identify a price inefficiency in a market you're familiar with and have access to trade. Arbitrage can be done across many parameters, so you will have to be creative and proactive
1. Determine what currencies to use. In order to have a triangular arbitrage, you must compare the exchange rate of three currency pairs that have correlating currencies. An example
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