Triangle arbitrage:
I.is a profitable situation involving three separate currency exchange transactions.
II.helps keep the currency market in equilibrium.
III.opportunities can exist in either the spot or the forward market.
IV.is based solely on differences in exchange ratios between spot and futures markets.

Question

Quizplus · Accepted Answer

Triangle arbitrage involves three separate currency exchange transactions to exploit differences in exchange rates, helps maintain market equilibrium by correcting price discrepancies, and can occur in both spot and forward markets. It is not based solely on differences between spot and futures markets.

Triangle Arbitrage: I.is a Profitable Situation Involving Three Separate Currency Exchange Transactions