arbitrage

American  

[ahr-bi-trahzh, ahr-bi-trij] / ˈɑr bɪˌtrɑʒ, ˈɑr bɪ trɪdʒ /

noun

1. Finance. the simultaneous purchase and sale of the same securities, commodities, or foreign exchange in different markets to profit from unequal prices.

2. Archaic. arbitration.

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verb (used without object)

arbitraged, arbitraging

1. Finance. to engage in arbitrage.

arbitrage British  

/ ˈɑːbɪˌtrɑːʒ, ˈɑːbɪtrɪdʒ, ˌɑːbɪtræˈʒɜː /

noun

1. finance

   1. the purchase of currencies, securities, or commodities in one market for immediate resale in others in order to profit from unequal prices

   2. ( as modifier )

      arbitrage operations

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Other Word Forms

• arbitrageur
  noun

Etymology

Origin of arbitrage

1470–80; < Middle French, equivalent to arbitr ( er ) to arbitrate, regulate (< Latin arbitrārī; see arbitrate) + -age -age

Explanation

"Buy low, sell high" is the mantra of the stock market. Perhaps the most extreme example of this is arbitrage, the act of buying and selling goods simultaneously in different markets to gain an immediate profit. Impressive, but tricky. Although the meaning of the word arbitrage as used today is relatively new, dating back to the late 19th Century, the word itself can be traced back to the Latin arbitrārī, with the meaning "to regulate." In English, arbitrage first meant "using personal judgment." If you practice arbitrage, you'll need to use great personal judgment in dealing with varying stock prices. Remember to pronounce the last syllable "trahzh," as if it were French.

Example Sentences

Arbitrage pricing: These companies are capturing demand from the smaller labs, indie studios, emerging markets and others that are priced out of AWS GPU pricing but still need computing.

From MarketWatch • Dec. 3, 2025

He decided to quit his day job and start Aftermarket Arbitrage - a reselling company that teaches others how to scalp.

From BBC • Mar. 11, 2022

There was an ad with his name and cartoon avatar reading, “My Arbitrage Deal!”

From Seattle Times • Dec. 13, 2021

Tactical Arbitrage is one of the most widely used.

From The Verge • Nov. 14, 2019

Arbitrage operations with distant countries such as India are large and mainly profitable.

From Encyclopaedia Britannica, 11th Edition, Volume 2, Slice 4 "Aram, Eugene" to "Arcueil" by Various