#ArbitrageTradingStrategy

What is Arbitrage Trading Strategy?

Arbitrage trading is an investment method that exploits price differences for the same financial asset in two or more markets to achieve profit with almost no risk.

How does it work?

If the price of a stock or cryptocurrency, for example, in Market A is $100, and in Market B it is $102, the trader can buy in Market A and sell in Market B immediately, benefiting from the difference ($2) as profit.

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Common Types of Arbitrage:

1. Inter-Exchange Arbitrage:

Exploiting price differences for the same asset in different exchanges.

2. Triangular Arbitrage:

Using price differences between three cryptocurrencies on the same exchange.

3. Statistical Arbitrage:

Based on statistical models to understand and predict price differences.

Advantages:

Low-risk profitability (theoretically).

Quick profits, as it relies on short-term price differences.