#ArbitrageTradingStrategy
🎯 Definition:
The Arbitrage Trading Strategy is a trading method aimed at achieving profits from price differences between different markets for the same asset at almost the same time — with little to no risk (theoretically at least).
---
🧠 How does it work?
Think of it as if you buy a phone from a store for $100 and immediately sell it in another store for $105. An instant profit of $5, without holding the phone or waiting for the price to change.
In financial markets, something similar happens:
1. In Market A: XYZ Company stock is trading at $100
2. In Market B (perhaps in a different country): the same stock is trading at $101
3. The smart trader:
Buys from the cheaper market
Sells in the more expensive market
And earns the difference: $1 per share.