Definition of Arbitrage:

  1. Buy and sell assets using arbitrage.

  2. The simultaneous buying and selling of securities, currency, or commodities in different markets or in derivative forms in order to take advantage of differing prices for the same asset.

  3. Profiting from differences in prices or yields in different markets. Arbitrageurs buy a commodity, currency, security or any other financial instrument in one place and immediately sell it at a higher price to a ready buyer at another place completing both ends of the transaction usually within a few seconds. Arbitrage is a sophisticated form of non-speculative, risk-free betting because it involves dealings where returns and prices are definite, fixed, and known. See also speculation.

How to use Arbitrage in a sentence?

  1. The scalper took advantage of arbitrage by buying tickets in advance at low prices and selling them to people who came to the show at the last minute and were willing to pay high prices to get in.
  2. Profitable arbitrage opportunities.
  3. The day traders practiced the art of arbitrage with skill, buying and selling throughout the day with barely any break in activity.
  4. Much of the short selling was being done by people who were arbitraging between the bond and the equity market.
  5. The broker was anxious to start learning all about arbitrage because he knew there was a lot of money to be made by exploiting the price differences in different markets.

Meaning of Arbitrage & Arbitrage Definition