Arbitrage is the practice of buying and selling assets simultaneously to profit from price differences.
An individual with a keen understanding of finance, known as an arbitrator, strategically utilizes market inefficiencies to their advantage. These inefficiencies can take the form of market volatility, price fluctuations, and dividends. The process of capitalizing on these differences by simultaneously buying and selling assets is known as arbitrage. As a knowledgeable professor, I will guide you through the nuances of this concept to help you grasp its significance in the world of finance.