#ArbitrageTradingStrategy :
Simple Explanation ๐
๐ Arbitrage Trading Strategy โ Explained Simply:
Arbitrage trading is a low-risk strategy that involves buying an asset in one market at a lower price and simultaneously selling it in another market at a higher price. The difference between the two prices is your profit.
---
๐ Example:
BTC is $30,000 on Exchange A
BTC is $30,050 on Exchange B
โ Buy from A, sell on B โ Profit = $50 (minus fees)
---
โ Common Types:
Spatial Arbitrage โ Across different exchanges
Triangular Arbitrage โ Between 3 currency pairs (e.g., USD โ BTC โ ETH โ USD)
Crypto/DeFi Arbitrage โ In the crypto and decentralized finance world
---
โ ๏ธ Risks:
Trading fees
Network delays
Price slippage
Transfer time between exchanges
---
๐ฏ Goal:
Exploit price inefficiencies quickly before markets correct them โ often using algorithms or bots.
