Arbitrage vs. Speculation

Arbitragenoun

(finance) A market activity in which a security, commodity, currency or other tradable item is bought in one market and sold simultaneously in another, in order to profit from price differences between the markets.

Arbitragenoun

(archaic) arbitration

Arbitrageverb

To employ arbitrage

Arbitrageverb

To engage in arbitrage in, between, or among

Arbitragenoun

Judgment by an arbiter; authoritative determination.

Arbitragenoun

A traffic in bills of exchange (see Arbitration of Exchange).

Arbitragenoun

the simultaneous or near simultaneous purchase and sale of the same or closely linked securities or commodities in different markets to make a profit on the (often small) differences in price.

Arbitragenoun

a kind of hedged investment meant to capture slight differences in price; when there is a difference in the price of something on two different markets the arbitrageur simultaneously buys at the lower price and sells at the higher price

Arbitrageverb

practice arbitrage, as in the stock market

Arbitragenoun

the simultaneous buying and selling of securities, currency, or commodities in different markets or in derivative forms in order to take advantage of differing prices for the same asset

Arbitrageverb

buy and sell assets using arbitrage

Arbitrage

In economics and finance, arbitrage (, UK also ) is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices at which the unit is traded. When used by academics, an arbitrage is a transaction that involves no negative cash flow at any probabilistic or temporal state and a positive cash flow in at least one state; in simple terms, it is the possibility of a risk-free profit after transaction costs.

Speculationnoun

The process of thinking or meditating on a subject.

Speculationnoun

(philosophy) The act or process of reasoning a priori from premises given or assumed.

Speculationnoun

A conclusion to which the mind comes by speculating; mere theory; notion; conjecture.

Speculationnoun

An investment involving higher-than-normal risk in order to obtain a higher-than-normal return.

Speculationnoun

The act or practice of buying land, goods, shares, etc., in expectation of selling at a higher price, or of selling with the expectation of repurchasing at a lower price; a trading on anticipated fluctuations in price, as distinguished from trading in which the profit expected is the difference between the retail and wholesale prices, or the difference of price in different markets.

Speculationnoun

Examination by the eye; view.

Speculationnoun

(obsolete) Power of sight.

Speculationnoun

A card game in which the players buy from one another trumps or whole hands, upon a chance of getting the highest trump dealt, which entitles the holder to the pool of stakes.

Speculationnoun

(programming) The process of anticipating which branch of code will be chosen and executing it in advance.

Speculationnoun

The act of speculating.

Speculationnoun

Examination by the eye; view.

Speculationnoun

A conclusion to which the mind comes by speculating; mere theory; view; notion; conjecture.

Speculationnoun

Mental view of anything in its various aspects and relations; contemplation; intellectual examination.

Speculationnoun

Power of sight.

Speculationnoun

The act or process of reasoning a priori from premises given or assumed.

Speculationnoun

A game at cards in which the players buy from one another trumps or whole hands, upon a chance of getting the highest trump dealt, which entitles the holder to the pool of stakes.

Speculationnoun

The act or practice of buying land, goods, shares, etc., in expectation of selling at a higher price, or of selling with the expectation of repurchasing at a lower price; a trading on anticipated fluctuations in price, as distinguished from trading in which the profit expected is the difference between the retail and wholesale prices, or the difference of price in different markets.

Speculationnoun

Any business venture in involving unusual risks, with a chance for large profits.

Speculationnoun

a message expressing an opinion based on incomplete evidence

Speculationnoun

a hypothesis that has been formed by speculating or conjecturing (usually with little hard evidence);

Speculationnoun

an investment that is very risky but could yield great profits;

Speculationnoun

continuous and profound contemplation or musing on a subject or series of subjects of a deep or abstruse nature;

Speculation

Speculation is the purchase of an asset (a commodity, goods, or real estate) with the hope that it will become more valuable in the near future. In finance, speculation is also the practice of engaging in risky financial transactions in an attempt to profit from short term fluctuations in the market value of a tradable financial instrument—rather than attempting to profit from the underlying financial attributes embodied in the instrument such as value addition, return on investment, or dividends.