Arbitrage

2 definitions found

From The Collaborative International Dictionary of English v.0.48 [gcide]:

  Arbitrage \Ar"bi*trage\, n. [F., fr. arbiter to give judgment,
     L. arbitrari.]
     1. Judgment by an arbiter; authoritative determination.
        [Archaic]
        [1913 Webster]
  


     2. (Com.) A traffic in bills of exchange (see {Arbitration of
        Exchange}).
        [1913 Webster]
  
     3. (Finance) the simultaneous or near simultaneous purchase
        and sale of the same or closely linked securities or
        commodities in different markets to make a profit on the
        (often small) differences in price.
        [PJC]

From WordNet (r) 2.0 [wn]:

  arbitrage
       n : a kind of hedged investment meant to capture slight
           differences in price; when there is a difference in the
           price of something on two different markets the
           arbitrageur simultaneously buys at the lower price and
           sells at the higher price
       v : practice arbitrage, as in the stock market