Buying large blocks of securities and holding them until the price rises sufficiently to warrant a sale is an example of pure arbitrage.

Name: Buying large blocks of securities and holding them until the price rises sufficiently to warrant a sale is an example of pure arbitrage.
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Question

Quizplus · Accepted Answer

Buying and holding securities in the hope of price appreciation is not considered pure arbitrage. Pure arbitrage involves taking advantage of price discrepancies in different markets simultaneously to make a riskless profit.

Buying Large Blocks of Securities and Holding Them Until the Price