Statistical Arbitrage

What does it Mean? A profit situation arising from pricing inefficiencies between securities. Investors identify the arbitrage situation through mathematical modeling techniques.
 
Investopedia Says... Statistical arbitrage is not without risk; it depends heavily on the ability of market prices to return to a historical or predicted normal.

Terms Related Links

Arbitrage
Market Arbitrage
Rational Pricing
Risk
Technical Analysis

Terms Related Links
Trading the Odds with Arbitrage - Profiting from arbitrage is not only for market makers--retail traders can find opportunity in risk arbitrage.

Arbitrage Squeezes Profit From Market Inefficiency - This influential strategy capitalizes on the relationship between price and liquidity.

Bettering Your Portfolio With Alpha And Beta - Increase your returns by creating the right balance of both these risk measures.

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