DEFINITION of 'Arbitrageur'
A type of investor who attempts to profit from price inefficiencies in the market by making simultaneous trades that offset each other and capturing riskfree profits. An arbitrageur would, for example, seek out price discrepancies between stocks listed on more than one exchange, and buy the undervalued shares on one exchange while short selling the same number of overvalued shares on another exchange, thus capturing riskfree profits as the prices on the two exchanges converge.
INVESTOPEDIA EXPLAINS 'Arbitrageur'
Arbitrageurs are typically very experienced investors since arbitrage opportunities are difficult to find and require relatively fast trading. Arbitrageurs also play an important role in the operation of capital markets, as their efforts in exploiting price inefficiencies keep prices more accurate than they otherwise would be.
VIDEO

Conversion Arbitrage
An options trading strategy employed to exploit the inefficiencies ... 
Arbitrage
The simultaneous purchase and sale of an asset in order to profit ... 
Merger Arbitrage
A hedge fund strategy in which the stocks of two merging companies ... 
Index Arbitrage
An investment strategy that attempts to profit from the differences ... 
Market Arbitrage
Purchasing and selling the same security at the same time in ... 
FixedIncome Arbitrage
An investment strategy that attempts to profit from arbitrage ...

What is arbitrage?
Arbitrage is basically buying in one market and simultaneously selling in another, profiting from a temporary difference. ... Read Full Answer >> 
How can I use a regression to see the correlation between prices and interest rates?
In statistics, regression analysis is a widely used technique to uncover relationships among variables and determine whether ... Read Full Answer >> 
How do I calculate a modified duration using Matlab?
The modified duration gauges the sensitivity of the fixed income securities to changes in interest rates. To calculate the ... Read Full Answer >> 
How do I calculate the rule of 72 using Matlab?
In finance, the rule of 72 is a useful shortcut to assess how long it takes an investment to double given its annual growth ... Read Full Answer >> 
How do I calculate the standard error using Matlab?
In statistics, the standard error is the standard deviation of the sampling statistical measure, usually the sample mean. ... Read Full Answer >> 
How do I adjust the rule of 72 for higher accuracy?
The rule of 72 refers to a time value of money formula that investors use to calculate how quickly an investment will double ... Read Full Answer >>

Active Trading
What Is Market Efficiency?
The efficient market hypothesis (EMH) suggests that stock prices fully reflect all available information in the market. Is this possible? 
Investing Basics
Top 4 Most Scandalous Insider Trading Debacles
Here we look at some of the landmark incidents of insider trading. 
Options & Futures
Arbitrage Squeezes Profit From Market Inefficiency
This influential strategy capitalizes on the relationship between price and liquidity. 
Options & Futures
Trading The Odds With Arbitrage
Profiting from arbitrage is not only for market makers  retail traders can find opportunity in risk arbitrage. 
Options & Futures
PutCall Parity And Arbitrage Opportunity
Look at trades that are profitable when the value of corresponding puts and calls diverge. 
Active Trading Fundamentals
Efficient Market Hypothesis: Is The Stock Market Efficient?
Deciding whether it's possible to attain aboveaverage returns requires an understanding of EMH. 
Options & Futures
Conversion Arbitrage
This stock/options combination helps traders take advantage of market mispricing. Find out how. 
Active Trading Fundamentals
Trade Takeover Stocks With Merger Arbitrage
This highrisk strategy attempts to profit from price discrepancies that arise during acquisitions. 
Trading Systems & Software
The FastPaced World of Libor & Fixed Income Arbitrage
LIBOR is an essential part of implementing the swap spread arbitrage strategy for fixed income arbitrage. Here is a stepbystep explanation of how it works. 
Fundamental Analysis
Spectator Vs. Speculator: Two Market Approaches
Spectators and speculators rely on different mechanisms to identify and profit from market opportunities.