Arbitrage -

: This activity actually helps the market by narrowing price gaps, eventually driving prices toward efficiency. Common Strategies

: They buy on the cheaper exchange and simultaneously sell on the more expensive one. arbitrage

Arbitrage is the practice of simultaneously buying and selling an asset in different markets to profit from a price discrepancy. It is a "risk-free" strategy in theory because the profit is locked in at the moment of the trade, though in practice, it requires extreme speed and sophisticated technology. How Arbitrage Works : This activity actually helps the market by

: Betting on the success (or failure) of a corporate merger by buying the target company's stock and shorting the acquirer's stock. It is a "risk-free" strategy in theory because

: A trader (often a computer) finds a price difference for the same asset on two different exchanges.

: Buying and selling the exact same financial instrument (like a stock or currency) across different exchanges.