The difference between foreign exchange arbitrage and arbitrage;

First of all, an arbitrage transaction is an arbitrage between two different contracts. These two contracts can be contracts with the same foreign exchange varieties but different maturities (period arbitrage and spot arbitrage), or contracts with the same foreign exchange varieties but different trading places (cross-market arbitrage). Arbitrage is a transaction between two foreign currencies of the same variety or three foreign currencies of different varieties with triangular relationship. In arbitrage trading, the term of foreign exchange varieties should be the same (the term of spot and futures contracts is the same).

Second, arbitrage trading is the operation of opening a position when the spread is abnormal and closing the position after the spread returns to normal level. So arbitrage trading needs to hold the contract for a certain period of time. In arbitrage trading, buying and selling happen at the same time. Traders buy at a low price and sell at a high price without holding positions for a certain period of time. At the same time, because the opportunity of arbitrage trading is very rare, the shorter the buying and selling interval, the greater the chance of arbitrage trading success.

Third, arbitrage trading is a transaction conducted by traders according to their judgment of future spreads. Only when the future spread trend is consistent with the trader's judgment can arbitrage be profitable. If the price difference trend is contrary to the trader's judgment, arbitrage trading will produce losses, so arbitrage trading has certain risks. In arbitrage trading, as long as there is an arbitrage opportunity between two traders, traders can make profits through arbitrage trading, and the market risk is relatively small.

Fourth, there are more opportunities for arbitrage trading than arbitrage trading. Arbitrage trading is the change of trading spread, and the spread has always existed. As long as the spread direction is accurately judged, arbitrage trading can be profitable. Arbitrage trading needs to know the quotation difference between traders, which is fleeting, so there are fewer opportunities for arbitrage trading than arbitrage trading.