In the world of finance and investments, statistical arbitrage is used in two related but distinct ways: In academic literature, "statistical arbitrage" is opposed to (deterministic) arbitrage. In deterministic arbitrage,…
Risk arbitrage, or merger arbitrage, is an investment or trading strategy often associated with hedge funds. Two principal types of merger are possible: a cash merger, and a stock merger.…
Political arbitrage is a trading strategy which involves using knowledge or estimates of future political activity to forecast and discount security values. For example, the major factor in the values…
Fixed-income arbitrage is an investment strategy generally associated with hedge funds, which consists of the discovery and exploitation of inefficiencies in the pricing of bonds, i.e. instruments from either public…
Covered interest arbitrage is the investment strategy where an investor buys a financial instrument denominated in a foreign currency, and hedges his foreign exchange risk by selling a forward contract…
Betting arbitrage, miraclebets, surebets, sports arbitraging is a particular case of arbitrage arising on betting markets due to either bookmakers’ different opinions on event outcomes or plain errors. By placing…
Types of arbitrage Merger arbitrage Also called risk arbitrage, merger arbitrage generally consists of buying the stock of a company that is the target of a takeover while shorting the…
In economics and finance, arbitrage is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon…
Financial economics Financial economics is the branch of economics studying the interrelation of financial variables, such as prices, interest rates and shares, as opposed to those concerning the real economy.…
Personal finance Questions in personal finance revolve around How much money will be needed by an individual (or by a family), and when? How can people protect themselves against unforeseen…
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