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There are a lot of 'soft' arbitrage opportunities out there, such as risk arbitrage or merger arbitrage. You may not have 100% certainty of a deal closing, but
by arb-spreads 4y ago
There are a lot of 'soft' arbitrage opportunities out there, such as risk arbitrage or merger arbitrage. You may not have 100% certainty of a deal closing, but can still profit over hundreds of events.
Most 'pure' arbs are exploited, but many still exist. They often require capital, expertise, and experience.
- lokar 4y agoThere are also sort of structural arbs, like for ETF funds (baskets in/out).
- arb-spreads 4y agoPrecisely, which require significant upfront investment/expertise in a consolidated space
- lokar 4y agoAnd the risk vs return is baked into the trade setup and fairly bounded.
- worik 4y ago> Most 'pure' arbs are exploited, but many still exist. They often require capital, expertise, and experience. Not really. Usually it is a higher tolerance for risk combined with not telling the customer how much risk they actually are taking. It is all good until it is not, and by then it is too late
- arb-spreads 4y agoAlameda Research made billions arbitraging wide spreads in Asian bitcoin exchanges relative to the rest of the world. Required working with local banks to solve logistics around wire transfers and such. Obviously a run of the mill crypto ponzi offering 30% interest or something will eventually collapse. Difficult to balance incentives when it comes to traditional finance offerings such as structured products or an actively managed investment vehicle. As you point out, customers struggle in evaluating risk
- triyambakam 4y agoWhat a fitting username!
- arb-spreads 4y ago; )
- hotpotamus 4y ago> They often require capital, expertise, and experience. I would tend to classify that as someone offering you work/a partnership rather than an arbitrage.