Definition

Noun: A person who practices arbitrage, specifically by simultaneously buying and selling the same asset (such as securities, commodities, or currencies) in different markets to profit from price differences between those markets.

Usage and Examples

• Noun:
  • The arb made a significant profit by buying oil futures in London and selling them at a higher price in New York.
  • Acting as an arb, she quickly capitalized on the temporary price discrepancy between the two stock exchanges.

Advanced Usage

• "to arb" (verb, informal): To engage in arbitrage. This is a back-formation from the noun "arb."
  • Traders will try to arb any noticeable price gap between the spot and futures markets.

Variants and Related Words

• Arbitrage (n): The simultaneous buying and selling of securities, currency, or commodities in different markets or in derivative forms to take advantage of differing prices.
  • The fund specializes in currency arbitrage.
• Arbitrageur (n): A more formal term for a person who engages in arbitrage. Synonymous with "arb."
  • The arbitrageur exploited the merger announcement for profit.

Synonyms

• Arbitrageur
• Arbitrager (less common)

Related Phrases and Concepts

• Risk arbitrage: A form of arbitrage involving the simultaneous purchase and sale of the stocks of merging companies.
  • The firm's strategy focused on risk arbitrage during corporate takeovers.
• Convertible arbitrage: An arbitrage strategy involving the purchase of convertible securities and the short sale of the same issuer's common stock.
  • His hedge fund was known for sophisticated convertible arbitrage.

Noun

1. someone who engages in arbitrage (who purchases securities in one market for immediate resale in another in the hope of profiting from the price differential)