Etymology An unadapted borrowing from French arbitrage, from arbitrer (“to arbitrate”); see arbitrate.
1
Business, Finance A market activity in which a security, commodity, currency or other tradable item is bought in one market and sold simultaneously in another, in order to profit from price differences between the markets.
But in recent years, for reasons we shall develop later, the field of "arbitrages and workouts" became riskier and less profitable.a. 1973, Benjamin Graham, The Intelligent Investor, HarperCollins, published 2003, page 174:
He has arbitraged by purchasing in one market and simultaneously selling the same or similar merchandise in another market.1961, Maurece Schiller, Fortunes in Special Situations in the Stock Market, page iv:
2
Business, Finance To engage in arbitrage in, between, or among
Indeed, as banks become more adept at internal risk classifications, their incentives to arbitrage economic and regulatory capital can only increase2001, Frederic S. Mishkin, Prudential Supervision: What Works and what Doesn't, page 98: