Arbitrage is a financial tool based on a simultaneous purchase and sale technics in order to profit from a difference in the price.
Arbitrage is a financial tool based on a simultaneous purchase and sale technics in order to profit from a difference in the price.
This tool has been created as a result of market inneficiencies. It ensure the variation of prices value during long period of time.
It's described as a risk free trade which is not available for individual investor but reliable for other large financial institution with larger blocks of share.
This is a short term opportunity. Once people have realized a market offered more security at a lower price, their interest increase the low price of this market and decrease the price that used to be high. And this happen until there is no longer a price difference. By this process, arbitrage ables markets'balance.