I. noun — [ mass noun] 1. the simultaneous buying and selling of securities, currency, or commodities in different markets or in derivative forms in order to take advantage of differing prices for the same asset.[as modifier] • profitable arbitrage opportunities.
II. verb — [no obj.] 1. buy and sell assets using arbitrage. • much of the short selling was being done by people who were arbitraging between the bond and the equity market.
– origin late Middle English (originally denoting the exercise of individual judgement): from French, from arbitrer ‘give judgement’, from Latin arbitrari (see arbitrate). The current sense dates from the late 19th cent.