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Tax arbitrage |
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Tax arbitrageTrading that takes advantage of a difference in tax rates or tax systems as the basis for profit.Tax arbitrage Similar MatchesCovered interest arbitrageCovered interest arbitrageA combination of transactions on two countries' securities and exchange markets designed to profit from failure of covered interest parity. A typical set of transactions would include selling bonds in one market, using the proceeds to buy spot foreign currency and foreign bonds, and selling forward the return at a future date. See also one-way arbitrage. ArbitrageurArbitrageurOne who profits from the differences in price when the same, or extremely similar, security, currency, or commodity is traded on two or more markets. The Arbitrageur profits by simultaneously purchasing and selling these securities to take advantage of pricing differentials (spreads) created by market conditions. See: Risk arbitrage, convertible arbitrage, index arbitrage, and international arbitrage. Conversion arbitrageConversion arbitrageThe simultaneous purchase of a stock, the purchase of a put, and the sale of a call, creating a riskless transaction. ArbitrageArbitrageA combination of transactions designed to profit from an existing discrepancy among prices, exchange rates, and/or interest rates on different markets without risk of these changing. Simplest is simultaneous purchase and sale of the same thing in different markets, but more complex forms include triangular arbitrage and covered interest arbitrage. ArbitrageArbitrageThe 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. Further SuggestionsCurrency arbitrageIndex arbitrage Locational arbitrage Arbitrage bonds Riskless arbitrage Arbitrage free option pricing models Multiple Arbitrage Merger Arbitrage Covered interest arbitrage Structured arbitrage transaction Special arbitrage account One-way arbitrage International arbitrage Arbitrage Trading Program (ATP) Triangular arbitrage Risk controlled arbitrage Convertible Arbitrage Reversal Arbitrage Discount Arbitrage arbitrageur Triangular arbitrage |
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