It is no great surprise that these peaks coincided with major new releases and sales (e.g. for buying low and selling high), while the line’s thickness reflects the volume of actual trades. The peaks represent moments when there was a great deal of room for arbitrage (i.e. The following diagram, for instance, captures the room for arbitrage (what we call an Index of Arbitrage Potential for Steam trades of Team Fortress 2 items) as it arose during the period 13 th November 2011 to 23 rd May 2012. No one has enough information on how actual prices diverge from their ‘equilibrium’ level so as to be able to measure, or to visualise, the potential for arbitrage. arbitrage and equilibrium) are extremely hard to pin down. One of the problems of living in the analogue world is that these concepts (e.g. And when it does disappear totally, we have equilibrium (the holy grail of the economists). The dream of buying low and selling high (for this is what arbitrage is all about) is the driver of all commerce but also its own worst enemy: for as everyone is trying to pursue it, the potential for arbitrage disappears. Arbitrage is the holy grail of every trader.
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