Arbitrage Quote by John Gutfreund
“Proprietary stock-index arbitrage is but one aspect of program trading. Arbitrage will take place whenever there is an imbalance created in one or more markets that are similar.”
About This Quote
Source Book: Market Wizards, 1990
Programmed trading exploits price imbalances across similar markets for profit.
In simple terms: Arbitrage uses market price differences.
Identify and trade price gaps.
Themes
Mood
Type
When to use this quote
- stock trading
- hedge fund strategies
- algorithmic execution
Key Concepts
Questions to Reflect On
- What markets show the biggest imbalances?
- How can technology improve arbitrage?
Requires precise data and speed.