What is an 'Arbitrage' opportunity?

What is an 'Arbitrage' opportunity?

Approach: Define a risk-free profit scenario.

The simultaneous purchase and sale of an asset in different markets to exploit a difference in price. It results in a risk-free profit with zero net investment.

Follow-up: Why are arbitrage opportunities rare in high-frequency trading?

Key concepts: price discrepancy, law of one price.