#ArbitrageTradingStrategy

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Arbitrage is a trading strategy that exploits price differences of the same asset in different markets. The arbitrageur buys the asset where the price is lower and simultaneously sells it where it is higher, making a minimal and risk-free profit. These opportunities arise from temporary market inefficiencies, such as delays in quotations or imbalances between supply and demand. Speed of execution is crucial, often entrusted to algorithms, as inefficiencies close quickly. Although profits per individual transaction are small, arbitrage contributes to market efficiency by aligning prices.