Arbitrage as it is. How and where? Implementation?
What is arbitrage?
The classic version is arbitrage between exchanges. For example, n units of currency are available on exchange A, say Euro/Dollar, for sale at the rate of 1.12600. At the same time on the B exchange we have the same amount of currency to buy at a rate of 1.12700. Suppose I am a broker and have access to these quotes at a certain point in time. What do I need to do to earn on this difference? I need to buy euros for dollars on exchange A and sell those euros for dollars on exchange B. As a result I earn 10 points on four digits. In general, it is the same as it was and probably is done by brokers in the trading rooms of the exchanges around the world.
But transferring money from one country's bank to another takes a very long time. You hardly have time to grab a bid while it's hot. In other words I must have a transit account, which is present on the stock exchange A, and on the exchange B (well do not rush the money from bank to bank - for a fraction of a second it is unlikely). What we offer in the fantasy brokerage company and other Forex kitchens - not that - the situation described above you will never see in the market, and not all brokerage companies do. On the Mosbirch? It seems that you will not see such a situation there either.
Could you advise how to implement such a situation? Perhaps it is done using futures/options, or something else... Preferably without licenses )) If you know something not for a small circle, please reply in a private message! Thanks in advance!
1. a broker does not trade on his own, otherwise it is no longer a broker.
2) Arbitrage generally requires the use of double capital. That is, to keep equal amounts of money in A and B accounts. Therefore 10 points of profit is a profit in both accounts.
3) This market is highly competitive, and there is nothing for a normal trader to do there. If you do this trading, you have to be a MMa on one of the stock exchanges.
The only places left are in temporary arbitrage (near/far futures) or in heterogeneous markets (spot/futures).
But transferring money from a bank in one country to a bank account in another takes a long time. It's unlikely that you can grab an application while it's hot. In other words I have to have some kind of transit account, which is present on the stock exchange A and on the stock exchange B (well, do not drive the funds from bank to bank - in a fraction of a second it is unlikely).
1. a broker does not trade on his own, otherwise it is no longer a broker.
2) Arbitrage generally requires the use of double capital. That is, to keep equal amounts of money in A and B accounts. Therefore 10 points of profit is a profit in both accounts.
3) This market is highly competitive, and there is nothing for a normal trader to do there. If you do this trading, you have to be a MMa on one of the stock exchanges.
There is only temporary arbitrage (short/far) or heterogeneous markets (spot/futures).
What is in the broker's account is his (he may or may not give it to the broker, depending on what has been agreed) )
2. Yes, but the amounts can be different.
You do not need to go where everything is grabbed, try crypto, everything is free there, or you may have your own exchange as a last resort.
Keep thinking.)
I mean, is it the right direction?
1) What is in the broker's account is his (he may or may not, depending on the agreement).
2. Yes, but the amounts may be different.
3. do not need to get into places where everything is grabbed, try crypto, everything is still free there, or you can set up your own exchange as a last resort.
1. that it's all his, I don't argue, but he won't trade on his own anyway.
2. The arbitrage ceiling is set by instant liquidity. Although in the fantasy world, there is no limit ;)
Probably tomorrow, today is the day off.
3. Probably tomorrow, it's the day off.
tomorrow will be late as always,
tomorrow we will have to buy from those who bought today )
1. a broker does not trade on his own, otherwise it is no longer a broker.
2) Arbitrage generally requires the use of double capital. That is, to keep equal amounts of money in A and B accounts. Therefore 10 points of profit is a profit in both accounts.
3) This market is highly competitive, and there is nothing for a normal trader to do there. If you do this trading, you have to be a MMa on one of the stock exchanges.
There is only temporary arbitrage (short/far futures) or heterogeneous markets (spot/futures).
2. Suppose I have two accounts. In one, in dollars, respectively, and the other in euros. My understanding is that the account should be multicurrency? I buy euros for dollars on exchange A, and sell both euros for dollars on exchange B. As a result the combined balance of dollars on both exchanges theoretically increased by 5 points. But they still need to equalize.) That is in any case, sooner or later, as currency depletes on one account, transfer it to another. Well, or have an amount in both accounts that exceeds the volume of possible deals. Right? Then there is no need to transfer money between accounts. But in this case a question appears: do you really earn on arbitrage? ))
3) Well, I'm not disputing it - HFT is very widespread there, otherwise there would be a lot of such smart guys)) Are there no such opportunities as before - when you can manage to buy on one exchange, call your agent on another and sell? )) Well, say on the same Webmani? But that's me being rude ))
3. don't go where it's all grabbed, try crypto, it's still free, or you can set up your own exchange as a last resort.
Let me tell you about one kind of arbitrage
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The classic version is arbitrage between exchanges. For example, on exchange A you have n units of currency, say Euro/Dollar, for sale at the rate of 1.12600. At the same time on the B exchange we have the same amount of currency to buy at a rate of 1.12700. Suppose I am a broker and have access to these quotes at a certain point in time. What do I need to do to earn on this difference? I need to buy euros for dollars on exchange A and sell those euros for dollars on exchange B. As a result I earn 10 points on four digits. In general, it is the same as it was and probably is done by brokers in the trading rooms of the exchanges around the world.
But transferring money from one country's bank to another takes a very long time. You hardly have time to grab a bid while it's hot. In other words I must have a transit account, which is present on the stock exchange A, and on the exchange B (well do not rush the money from bank to bank - for a fraction of a second it is unlikely). What we offer in a fantasy brokerage company and other Forex kitchens - not the way - you will never see the above described situation in the market, and not all brokerage companies do. On the Mosbirch? It seems that you will not see such a situation there either.
Connoisseurs, advise how to implement such a thing? Maybe someone has already done similar? The theory and arguments are certainly good, but I am interested in the practical side of the issue. Implementation schemes - preferably not through a third-party / brokerage firms. With our own forces. That is, I - just a mortal, go, get two brokerage accounts at banks A and B, do this, that and go ... ))
Perhaps this is done using futures/options, or something else... Preferably without licenses )) If you know something that is not for narrow circles - wait for reply in a private message! Thanks in advance!