Pure or riskless arbitrage is defined as a profitable position obtained with no net investment and no risk.

Question

Quizplus · Accepted Answer

Pure or riskless arbitrage involves taking advantage of price discrepancies in different markets without any net investment or risk. This means that the arbitrageur is able to make a profit without putting any of their own money on the line, and there is no risk that the market will move against them and wipe out their gains. Therefore, it is a truly riskless strategy.

Pure or Riskless Arbitrage Is Defined as a Profitable Position