Arbitrage

In economics, arbitrage is the practice of taking advantage of a state of imbalance between two or more markets: a combination of matching deals are struck that exploit the imbalance, the profit being the difference between the market prices. A person who engages in arbitrage is called an arbitrageur. The term is mainly applied to trading in financial instruments, such as bonds, stocks, derivatives and currencies

Related Topics:
Economics - Market - Market price - Financial instrument - Bond - Stock - Derivatives - Currencies

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Statistical arbitrage is an imbalance in expected values. A casino usually has a statistical arbitrage in every game of chance played, even though it could lose money on any single game.

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