Financial Terms / arbitrage

Exploring Arbitrage Opportunities

Arbitrage is a trading strategy used by large financial institutions to buy and sell the same asset in different markets to profit from small price discrepancies.


Investment = ( figure / odds) + ( figure / odds)

How do I calculate the arbitrage?

When calculating Arbitrage, it is important to first divide the figure by the odds. After that, add the resulting quotients together to calculate the investment. This process is best done in Sourcetable, as it will help make the calculations easier.  
The formula for calculating Arbitrage is:
Investment = ( figure / odds) + ( figure / odds)

What is Arbitrage?

Arbitrage is the purchase and sale of the same or similar asset in different markets to profit from tiny differences in the asset's listed price.

What markets does Arbitrage occur in?

Arbitration trades are made in stocks, commodities, and currencies.

What is the purpose of Arbitrage?

Arbitrage both exploits market inefficiencies and resolves them.

How does Arbitrage work?

Arbitrage exploits inefficiencies in the market. It is a complex strategy that involves many different assets and securities.

Key Points

How do I calculate arbitrage?
Investment = ( figure / odds) + ( figure / odds)
Arbitrage is a Financial Strategy
Arbitrage is a financial strategy that involves simultaneously buying and selling a security, commodity, or currency. This strategy is used to capture a profit from a discrepancy in price between two markets in order to make a risk-free profit.
Low Risk Strategy
Arbitrage is a relatively low risk strategy because it focuses on exploiting market inefficiencies rather than attempting to outguess the market. This makes it a viable option for investors of all levels.

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