A) Predicting future market trends. B) Exploiting price differences for the same asset in different markets. C) Influencing market prices through large trades. D) Holding assets for long-term appreciation.
A) Real-time market data and price comparison. B) Reliance on historical price charts. C) Following advice from market analysts. D) Gut feeling and intuition.
A) Execution risk. B) Credit risk. C) Inflation risk. D) Market risk.
A) Trading options with high volatility. B) Investing in mergers and acquisitions. C) Short selling overvalued stocks. D) Buying and selling currencies at random times.
A) Exploiting price discrepancies between three currencies. B) Investing in three different countries. C) Using three different trading strategies. D) Trading stocks in three different sectors.
A) It has no impact on profitability. B) It increases potential profits. C) It reduces potential profits. D) It only affects institutional investors.
A) Easy access to capital. B) Lack of regulatory oversight. C) Too much available information. D) Opportunities disappearing quickly.
A) Bond market. B) Real estate market. C) Forex market. D) Commodities market.
A) Ignoring currency exchange rates when investing internationally. B) Exploiting interest rate differentials and using forward contracts. C) Investing in high-yield bonds without considering risk. D) Borrowing money to invest in speculative assets.
A) HFT algorithms can quickly identify and execute arbitrage opportunities. B) HFT focuses solely on long-term investments. C) HFT eliminates all arbitrage opportunities. D) HFT has no impact on arbitrage.
A) To manage the investor's portfolio. B) To guarantee profits from arbitrage. C) To provide financial advice. D) To facilitate the execution of trades.
A) Blind luck. B) Sufficient capital. C) Inside information. D) Personal relationships with market makers.
A) Exploiting price differences in different geographical locations. B) Arbitraging different time horizons. C) Using different trading strategies. D) Trading different types of assets.
A) Market forces tend to eliminate price discrepancies. B) Arbitrage is illegal. C) Traders lose interest quickly. D) Governments regulate them out of existence.
A) Regulatory risk is only relevant for large institutions. B) Regulations always favor arbitrageurs. C) Changes in regulations can impact profitability. D) Arbitrage is unregulated.
A) It always increases profits. B) It magnifies both profits and losses. C) It eliminates the risk of losses. D) It has no impact on profitability.
A) A piece of land. B) A house. C) Stocks. D) A car.
A) Arb-neutral. B) Arb-loss. C) Arb-win. D) Arb-failure.
A) Retail arbitrage. B) Statistical arbitrage. C) Value arbitrage. D) Convertible arbitrage.
A) To identify mispricings through algorithms. B) To predict the news. C) To manipulate market prices. D) To eliminate all risks.
A) It increases price volatility. B) It leads to market crashes. C) It benefits only institutional investors. D) It reduces price discrepancies.
A) Risk-free profit. B) Illegal activity. C) Extremely complex strategy. D) Guaranteed high profit.
A) High availability of capital. B) Guaranteed profits. C) Low competition. D) High transaction costs relative to profit.
A) Information is irrelevant. B) Early access to information is crucial. C) All information leads to successful arbitrage. D) Information is only useful for long-term investing.
A) Stagnant markets. B) Perfectly efficient markets. C) Highly regulated markets. D) Inefficient markets.
A) No competition. B) Unlimited liquidity. C) Slippage. D) Guaranteed profits.
A) Very long-term. B) Short-term. C) Long-term. D) Medium-term.
A) Creativity. B) Speed and efficiency. C) Patience. D) Loyalty.
A) Retail arbitrage B) Statistical arbitrage. C) Covered interest arbitrage D) High frequency arbitrage
A) Nothing changes. B) Markets become more efficient. C) Markets become less liquid. D) Markets crash |