Arbitrage, also known as hedging profit, refers to foreign exchange transactions in which funds are transferred from countries or regions with lower interest rates to countries or regions with higher interest rates to make investments in order to obtain spread income. Refers to buying and selling two different futures contracts at the same time. Arbitrage: Buy a futures contract [1] and sell a different futures contract at the same time. The futures contracts here can be different delivery months of the same futures product. It can also be two interrelated different commodities. It can also be the same commodity in different futures markets. Arbitrage traders long on one futures contract and short on another futures contract, and profit from the price difference between the two contracts has little to do with the absolute price level.

Arbitrage trading has become the main trading means in the international financial market. Because of its stable returns and relatively small risks, most large funds in the world mainly participate in the futures or options market by arbitrage or partial arbitrage. With the standardized development of China's futures market and the diversification of listed products, the market contains a lot of arbitrage opportunities, and arbitrage trading has become an effective means for some large institutions to participate in the futures market.

In arbitrage trading, investors are concerned about the mutual price relationship between contracts, not the absolute price level. Investors buy contracts they think are undervalued by the market and sell contracts they think are overvalued by the market. If the price change direction is consistent with the original forecast; That is, the price of the buying contract is higher and the price of the selling contract is lower, so investors can benefit from the change of the relationship between the two contract prices. On the contrary, investors will lose money.