Arbitrage

Profiting from differences in the price of a single asset (such as a currency pair) that is traded on more than one market. For arbitrage opportunities to exist, the currency pair must be traded simultaneously on two different markets, and at different prices. One very common form of arbitrage is hedging, which is a practice of buying a security on one market (e.g. the spot FOREX market) and selling the options on that currency pair in another market (e.g. currency options market). Arbitrage is also used in sports, in trading exchange traded funds and also in trading credit default swaps.

By |2018-09-04T14:04:22+00:00September 4th, 2018|0 Comments

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