Multiple Arbitrage


 

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Multiple Arbitrage

In the context of hedge funds, a style of management where by the fund employs more than one arbitrage strategy. Portfolio manager opportunistically allocates capital among the various strategies in order to create the best risk/reward profile for the overall fund. Common strategies include merger arbitrage, convertible arbitrage, fixed income arbitrage, long/short equities pairs trading, and volatility arbitrage. In the context of equity and private equity investment, this refers to an investment in a firm where by standard multiples (earnings/price, book/price) indicate the price is far cheaper than industry averages.



Multiple Arbitrage

Similar Matches

Reversal Arbitrage

Reversal Arbitrage

A riskless arbitrage that involves selling the stock short, writing a put, and buying a call. The options have the same terms.


Arbitrage

Arbitrage

The simultaneous purchase and sale of two different, but closely related, securities to take advantage of a disparity in their prices. Alternatively, the purchase and sale of the same security in different markets.Originally, most arbitrage occurred in the currency markets: arbitrageurs would buy in one market and sell in another. Nowadays, the practice applies equally to commodities, futures and stocks. For instance, if a company is dual-listed on two stock exchanges, and the prices are at variance, an arbitrageur has an opportunity to buy in one market and sell in another before the disparity is closed.


Arbitrage bonds

Arbitrage bonds

Municipality issued bonds issued intended to gain an interest rate advantage by refunding a higher-rate bond in ahead of their call date. Lower-rate refunding issue proceeds are invested in Treasuries until the first call date of the higher-rate issue.


One-way arbitrage

One-way arbitrage

The use, by a potential supplier or demander in a market, of a different market or markets to accomplish the same purpose, taking advantage of a discrepancy among their prices. With transaction costs, this enforces smaller price discrepancies than would be permited by conventional arbitrage. Due to Deardorff (1979).


International arbitrage

International arbitrage

Simultaneous buying and selling of foreign securities and ADRs to capture the profit potential created by time, currency, and settlement inconsistencies that vary across international borders.


Further Suggestions

Currency arbitrage
Tax arbitrage
Arbitrageur
Triangular arbitrage
Triangular arbitrage
Arbitrage Trading Program (ATP)
Merger Arbitrage
arbitrageur
Structured arbitrage transaction
conversion arbitrage
Risk controlled arbitrage
Arbitrage
Convertible Arbitrage
Index arbitrage
Arbitrage free option pricing models
Discount Arbitrage
Covered interest arbitrage
Locational arbitrage
Covered interest arbitrage
Special arbitrage account
Riskless arbitrage


 
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