|Glossary Term: ARBITRAGE|
Definition(s) for ARBITRAGE:
1. ) refers to the act of taking advantage of differences in price between markets. For example, if a stock is quoted on two different equity markets, there is the possibility of arbitrage if the quoted price in one market differs from the quoted price in the other.
2. ) refers to the simultaneous purchase and sale of substantially identical assets in order to profit from a price difference between the two assets. Arbitrage may be employed by using various security combinations including stock and options and convertibles and stock.
3. ) Arbitrage is the simultaneous purchase and sale of similar commodities in different markets to take advantage.
4. ) A technique used by alert traders, now aided by sophisticated computer programs, to profit from minute price differences for the same security on different markets. For example, if a computer monitoring markets notices that ABC stock can be bought on a New York exchange for $10 a share and sold on a London exchange at $10.12, the arbitrageur or a special program can simultaneously purchase ABC stock in New York while selling the same amount it in London, thus pocketing the difference.
5. ) The process in which professional traders simultaneously buy and sell the same or equivalent securities for a riskless profit. See also Risk Arbitrage.
6. ) A trading technique that involves the simultaneous purchase and sale of identical assets or of equivalent assets in two different markets with the intent of profiting by the price discrepancy.
7. ) Buying securities in one country, currency or market and selling in another to take advantage of any price differences.
8. ) Buying securities in one country, currency or market, and selling in another to take advantage of price differences.
9. ) Taking advantage of different rates, prices or conditions between different markets or maturities. This typically involves buying an asset in one market at a lower price and simultaneously selling it in another market for a higher price.
10. ) Buying shares in one market and then selling them in another at a higher price to profit from the price differential.
ARBITRAGE CDO (COLLATERIZED DEBT OBLIGATION), ARBITRAGE FREE, MERGER ARBITRAGE, TAX ARBITRAGE, ARBITRAGE BONDS, ARBITRAGE PRICING THEORY (APT), ARBITRAGE-FREE OPTION-PRICING MODELS, CONVERTIBLE ARBITRAGE, COVERED INTEREST ARBITRAGE, CURRENCY ARBITRAGE, DISCOUNT ARBITRAGE, INTERNATIONAL ARBITRAGE, LOCATIONAL ARBITRAGE, REVERSAL ARBITRAGE, RISK ARBITRAGE, RISKLESS ARBITRAGE, STRUCTURED ARBITRAGE TRANSACTION, TRIANGULAR ARBITRAGE