What is arbitrage? Generally it means buying low at one point of time or in market at a lower price and selling it at a higher price latter on or in another market. Arbitrage mainly means buying low in one market and selling high in another.
There are plenty of arbitrage opportunities that can be profitably availed. Places like Ebay, Amazon, Craigslist and Kijiji are great places for arbitrage.
In addition to arbitrage business in products, there are tremendous opportunities in forex and stocks as well. There are many terms associated with arbitrage like stocks arbitrage, equity arbitrage, derivatives arbitrage, options arbitrage, sports arbitrage, currency arbitrage etc.
The most popular form of arbitrage trading relates to buying and selling of things. Equity arbitrage and currency arbitrage are also common, but only advanced traders can do those forms.
Buying and selling of things at different markets is perhaps the easiest form. Anyone can practice this. All one has to do is to be on the lookout for an arbitrage opportunity in any of the familiar markets like eBay and Craigslist.
One can always browse listings at these sites and pick up the ones which are underpriced. Basically one needs to find underpriced commodities. There are numerous times when some products are selling cheaper than their fair values. This provides an opportunity to buy them and then sell at a higher prices at another market or in the same market. This is also called flipping.
There are many reasons for the prices being low in one market or at one point of time than the other. For example many a times some things sell for less than their average or fair price in eBay because of less favorable times, placement in wrong category, misspelled listings, lack of proper keywords etc.
These are not exceptional circumstances. But these happen quite often. Many persons are known to be doing only arbitrage trading. They simple buy things cheap and sell at higher prices.
Arbitrage between Craigslist and eBay can also be quite lucrative. Individuals buy in local Craigslist and then can sell on eBay or vice versa.
It is not hard to find the proper value of anything. “Completed Listings” feature of eBay can be a very good guide in this. If someone is interested in arbitraging something, he can always look in the completed listings in eBay and get an idea about its fair value. That way, a decision could be made whether to go after it or not.
Sports arbitrage is another area where numerous individuals have benefited. Once again this is not the forte of every person and it also requires appropriate arbitrage software.
There are great opportunities to benefit from this business and one can develop it as effectively as an online business.