Arbitrage - Revision history

Doug: Replace broken link,

2024-12-25T20:50:36Z

Replace broken link,

← Older revision		Revision as of 20:50, 25 December 2024
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	== Other resource ==		== Other resource ==
	[Student article - Arbitrage - or Too good to be true?]		[https://learning.treasurers.org/resources/how-to-define-arbitrage-profits Student article - Arbitrage - or Too good to be true?]

			[[Category:Accounting,_tax_and_regulation]]
			[[Category:Compliance_and_audit]]
			[[Category:Technology]]
			[[Category:The_business_context]]

	[[Category:Accounting,_tax_and_regulation]]		[[Category:Accounting,_tax_and_regulation]]

Doug: Replace broken link.

2024-12-25T20:49:37Z

Replace broken link.

← Older revision		Revision as of 20:49, 25 December 2024
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	== ~~Student article~~ ==		== Other resource ==
	[~~[Media:2016_07_July_~~-~~_Too_good_to_be_true.pdf\|~~ Arbitrage - or ~~too~~ good to be true?]]		[Student article - Arbitrage - or Too good to be true?]

	[[Category:Accounting,_tax_and_regulation]]		[[Category:Accounting,_tax_and_regulation]]
	~~[[Category:The_business_context]]~~
	[[Category:Compliance_and_audit]]		[[Category:Compliance_and_audit]]
	[[Category:Technology]]		[[Category:Technology]]
			[[Category:The_business_context]]

imported>Doug Williamson: Add links.

2022-08-03T21:28:21Z

Add links.

← Older revision		Revision as of 21:28, 3 August 2022
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	* [[Arbitrageur]]		* [[Arbitrageur]]
	* [[Backwardation]]		* [[Backwardation]]
			* [[Covered interest arbitrage]]
	* [[Dislocation]]		* [[Dislocation]]
	* [[Hedging]]		* [[Hedging]]
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	* [[Synthetic]]		* [[Synthetic]]
	* [[Tax arbitrage]]		* [[Tax arbitrage]]
			* [[Uncovered interest arbitrage]]

imported>Doug Williamson: Classify page.

2021-08-14T23:43:34Z

Classify page.

← Older revision		Revision as of 23:43, 14 August 2021
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	[[Media:2016_07_July_-_Too_good_to_be_true.pdf\| Arbitrage - or too good to be true?]]		[[Media:2016_07_July_-_Too_good_to_be_true.pdf\| Arbitrage - or too good to be true?]]

			[[Category:Accounting,_tax_and_regulation]]
			[[Category:The_business_context]]
	[[Category:Compliance_and_audit]]		[[Category:Compliance_and_audit]]
	[[Category:Technology]]		[[Category:Technology]]

imported>Doug Williamson: Add definition. Source: Linked pages

2021-08-14T23:43:09Z

Add definition. Source: Linked pages

← Older revision		Revision as of 23:43, 14 August 2021
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	== 1. ~~Broad definition ==~~		1. ''Trading - market pricing.''


	In a broad sense, arbitrage means:		In a broad sense, arbitrage means:
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	== 2. ~~Narrower definition ==~~		2. ''Trading.''


	Defined more narrowly, arbitrage means the purchase of assets in one market and the simultaneous sale of the same or equivalent assets in the same or related markets, in order to earn immediate profits from a temporary price differential within a market or between related markets.		Defined more narrowly, arbitrage means the purchase of assets in one market and the simultaneous sale of the same or equivalent assets in the same or related markets, in order to earn immediate profits from a temporary price differential within a market or between related markets.
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	When this activity involves the simultaneous purchase and sale of the same contracts on different markets, it is sometimes known as 'switching'.		When this activity involves the simultaneous purchase and sale of the same contracts on different markets, it is sometimes known as 'switching'.


			3. ''Tax - regulation.''

			Tax arbitrage and regulatory arbitrage are activities that take advantage of differences in tax, or differences in regulation, between different jurisdictions.

imported>Doug Williamson: Add link.

2021-03-12T08:48:23Z

Add link.

← Older revision		Revision as of 08:48, 12 March 2021
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	* [[Interest arbitrage]]		* [[Interest arbitrage]]
	* [[No arbitrage conditions]]		* [[No arbitrage conditions]]
			* [[Option]]
	* [[Parity]]		* [[Parity]]
	* [[Put-call parity theory]]		* [[Put-call parity theory]]

imported>Doug Williamson: Add link.

2020-04-22T01:31:57Z

Add link.

← Older revision		Revision as of 01:31, 22 April 2020
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	* [[Arbitrageur]]		* [[Arbitrageur]]
	* [[Backwardation]]		* [[Backwardation]]
			* [[Dislocation]]
	* [[Hedging]]		* [[Hedging]]
	* [[Interest arbitrage]]		* [[Interest arbitrage]]

imported>Doug Williamson: Link with Student article.

2017-04-16T11:00:16Z

Link with Student article.

← Older revision		Revision as of 11:00, 16 April 2017
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	* [[Synthetic]]		* [[Synthetic]]
	* [[Tax arbitrage]]		* [[Tax arbitrage]]


			== Student article ==
			[[Media:2016_07_July_-_Too_good_to_be_true.pdf\| Arbitrage - or too good to be true?]]

	[[Category:Compliance_and_audit]]		[[Category:Compliance_and_audit]]
	[[Category:Technology]]		[[Category:Technology]]

imported>Doug Williamson: Removed link

2016-11-16T13:44:49Z

Removed link

← Older revision		Revision as of 13:44, 16 November 2016
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	* [[Arbitrageur]]		* [[Arbitrageur]]
	* [[Backwardation]]		* [[Backwardation]]
	* [[CertFMM]]
	* [[Hedging]]		* [[Hedging]]
	* [[Interest arbitrage]]		* [[Interest arbitrage]]

imported>Doug Williamson: Update.

2016-05-11T15:22:22Z

Update.

← Older revision		Revision as of 15:22, 11 May 2016
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	*Dealing simultaneously in the related market instruments to earn profits free from the risk of changes in market prices.		*Dealing simultaneously in the related market instruments to earn profits free from the risk of changes in market prices.

	The simplest theoretical form of arbitrage activity would be to deal simultaneously in two identical ~~instruments~~ at two different market prices.
	In practice such simple arbitrage opportunities are very rare. More commonly, arbitrage activities involve dealing in equivalent combinations of larger numbers of different instruments.		The simplest theoretical form of arbitrage activity would be to deal simultaneously in two identical assets at two different market prices.

			In practice such simple arbitrage opportunities are very rare.

			More commonly, arbitrage activities involve dealing in equivalent combinations of larger numbers of different instruments.


	A market participant who takes advantage of arbitrage opportunities is known as an arbitrageur.		A market participant who takes advantage of arbitrage opportunities is known as an arbitrageur.

	Under efficient market conditions, the activities of arbitrageurs and other market players create supply and demand pressures in the market which act to eliminate temporary pricing discrepancies.		Under efficient market conditions, the activities of arbitrageurs and other market players create supply and demand pressures in the market which act to eliminate temporary pricing discrepancies.


	Many valuation and pricing models are based on ‘no arbitrage’ assumptions. In other words, the valuation models assume that all pre-existing arbitrage opportunities in the market have been identified and eliminated, so that it is now possible to predict the values and market prices of traded ~~instruments~~ by calculating them from other related market prices.		Many valuation and pricing models are based on ‘no arbitrage’ assumptions.

			In other words, the valuation models assume that all pre-existing arbitrage opportunities in the market have been identified and eliminated, so that it is now possible to predict the values and market prices of traded assets by calculating them from other related market prices.


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	Defined more narrowly, arbitrage means the purchase of ~~securities~~ in one market and the simultaneous sale of the same or equivalent ~~securities~~ in the same or related markets, in order to earn immediate profits from a temporary price differential within a market or between related markets.		Defined more narrowly, arbitrage means the purchase of assets in one market and the simultaneous sale of the same or equivalent assets in the same or related markets, in order to earn immediate profits from a temporary price differential within a market or between related markets.


	When this activity involves the simultaneous purchase and sale of the same contracts on different markets, it is sometimes known as 'switching'.		When this activity involves the simultaneous purchase and sale of the same contracts on different markets, it is sometimes known as 'switching'.