Triangular Arbitrage Step-by-Step
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Uploader Comments (collegefinance)
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All Comments (6)
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how to you know which banks to use for the cross rate
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Hi hi! Have you thought about the British Box Breakout (just google it)? Ive heard some great things about it and my cousin earned tons of money.
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Thank you so much for this, I have been trying so long to understand it and you illustrated it in a manner that was easy to follow and understand
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you lost me at 2 minutes
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You want to make sure that the implied cross rate contains the currency in which you want to trade, in this example it's the yen.
collegefinance 1 week ago
The idea is to determine if there is a difference between the quoted cross-rate and the implied cross-rate. If so, we buy at the lower price and sell at the higher price and make arbitrage profit.
If there is no difference between the quoted cross-rate and the implied cross-rate, we would be buying and selling at the same price so there would not be an arbitrage profit.
collegefinance 4 months ago