Arbitrage type strategies.

Discussion in 'Strategy Building' started by wastrading, Jun 18, 2005.

  1. Does anyone do these with an IB account? I know they are very difficult with a retail account due to not getting the full interest credits. Are there any resources for these or even good books. I can't find any.
    Or a similiar option type strategy.
    Thanks in advance
    wastrading
     
  2. nitro

    nitro

    You need killer comissions, no cancel fees, fast lines to the exchanges and have access to the data and be able to process it faster than the next guy.

    Then you might have a chance.

    nitro
     
  3. MTE

    MTE

    For what it's worth Nitro is 100% correct. Arbitrage trading is what floor traders do, it is virtually impossible to trade arbitrage for a retail off-floor trader.

    By the way, you don't even mention what arbitrage strategies you're thinking of!?
     
  4. Is every combination exploited? Are there still anomolies across instruments seemingly being unrelated to each other...like can one move and another does later...can this float from day to day?

    The search continues :)

    Michael B.
     
  5. or do some pseudo-arb then speed is not as important anymore
     
  6. kut2k2

    kut2k2

    Pardon my ignorance but does that include spread trading? There's a guy posting a spread trading journal in the Journals forum -- is he just blowing smoke at us? TIA.
     
  7. MTE

    MTE

    No, spread trading is not arbitrage.
     
  8. What is a pseudo arb? Can you provide an example?
     
  9. It's not *that* hard to calculate huge covariance matrices for different time lags.

     
  10. Arbitrage covers a very wide range of strategies. Pairs trading, merger arbitrage, and other forms of risk arbitrage are often quite accessible to retail traders.

    Riskless arbitrage is highly competitive and you generally need to have an edge in execution or resources, as you point out.

    Martin
     
    #10     Jun 18, 2005