Definitions

from The American Heritage® Dictionary of the English Language, 4th Edition

  • n. The purchase of securities on one market for immediate resale on another market in order to profit from a price discrepancy.
  • intransitive v. To be involved in arbitrage.

from Wiktionary, Creative Commons Attribution/Share-Alike License

  • n. The practice of quickly buying and selling foreign currencies in different markets in order to make a profit
  • n. The purchase of the stock of a future takeover target, with the expectation that the stock will be sold to the person executing the takeover at a higher price
  • n. Any market activity in which a commodity is bought and then sold quickly, for a profit which substantially exceeds the transaction cost
  • v. To employ arbitrage
  • v. To engage in arbitrage in, between, or among

from the GNU version of the Collaborative International Dictionary of English

  • n. Judgment by an arbiter; authoritative determination.
  • n. A traffic in bills of exchange (see Arbitration of Exchange).
  • n. 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.

from The Century Dictionary and Cyclopedia

  • n. Arbitration. R. Cobden.
  • n. The calculation of the relative value at the same time, at two or more places, of stocks, bonds, or funds of any sort, including exchange, with a view to taking advantage of favorable circumstances or differences in payments or other transactions; arbitration of exchange.
  • n. The business of bankers which is founded on calculations of the temporary differences in the price of securities, and is carried on through a simultaneous purchase in the cheaper and sale in the dearer market.

from WordNet 3.0 Copyright 2006 by Princeton University. All rights reserved.

  • 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

Etymologies

Middle English, arbitration, from Old French, from arbitrer, to judge, from Latin arbitrārī, to give judgment; see arbitrate.
(American Heritage® Dictionary of the English Language, Fourth Edition)
From French arbitrage, from arbitrer ("to arbitrate"); see arbitrate. (Wiktionary)

Examples

Comments

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  • Used in finance to describe the purchasing and immediate selling of goods or stocks to take advantage of momentary price fluctuations.

    September 19, 2007

  • Money gained by rent-seekers and other unproductive people

    September 18, 2007