| It is true that an arbitrageur who had bought three-months' sterling could resell the sterling before the three months had elapsed, but if he did so he might have to accept a loss. |
| The King of financial arbitrage capitalism is the financial arbitrageur. |
| As for the degree of risk to be taken in business of this kind, that is entirely at the discretion of the arbitrageur. |
| However, as the convertible bond and the stock can move independently, the arbitrageur can lose on both the bond and the stock, which means the position carries risk. |
| The arbitrageur will sell the over priced bond to the dealer at the bid price, and buy the under priced bond from the dealer at the ask price. |
| The speculator is betting on changes in the price, while the arbitrageur is betting on changes in the spread. |
