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I'm afraid you don't understand the point of arbitrage, at all. As others have said, by definition, an arbitrage is risk free (or, in practice, nearly risk fre
by feral 15y ago
I'm afraid you don't understand the point of arbitrage, at all.
As others have said, by definition, an arbitrage is risk free (or, in practice, nearly risk free).
Buying extremely risky Greek Bonds, with borrowed USD, is just making a leveraged investment.
Considering the transaction costs you'll pay, as a small time buyer, and the various worked in charges, you will certainly be losing out, when the risk etc is factored in.
Its a bad way to fund your startup; its up there with buying lottery tickets, or playing roulette to make more money: might work out ok, sometimes, or even all the times you try it - but its a negative expectation thing to do.
- nirvana 15y agoThe problem is you do not understand risk at all. You compare things with many orders of magnitude different risks as if they were equally risky. In fact, in my original post, I addressed the issue of risk, and mentioned hedging that risk using put options. Yet, you think that because you're not sophisticated enough, or didn't bother to actually read my post, you think you can spout off and accuse of saying things I did not say. In fact, you claim that I "don't understand the point of arbitrage, at all", on the basis that you are unable to price risk accurately, or do not understand the concept of hedging. But hey, just keep on thinking that gold is very risky.... sucker.
- dasil003 15y agoYou're claiming gold is not risky? You're like the cheap little ads plastered all over the back of magazines trying to sell you gold. If gold is such a sure bet, why are so many people so desperate to sell it to you?
- deleted 15y ago[deleted]