Riskless arbitrage

Riskless arbitrage

The simultaneous purchase and sale of the same asset to yield a profit.

Riskless Arbitrage

The act of buying an asset and immediately selling the same asset for a higher price. For example, one may execute two orders at once, one to buy a security at $10 and one to sell the same security at $12. The short time frame involved means that riskless arbitrage occurs without investment; there is no rate of return or anything like it because the asset is immediately sold. One simply makes a profit on the deal.
References in periodicals archive ?
Few investors set up this riskless arbitrage because no one thought the market would go down enough to make a profit on the bonds.
In practice, however, it is difficult to find a truly riskless arbitrage position.
This process was iterated until reaching a total removal of the riskless arbitrage hedging.
Second, any nominally riskless arbitrage portfolio in country 0 is riskless in nominal and real terms for any international investor.