Best Arbitrage (risk free/sure profit) opportunities market?

Question

There are bond, stock, forex, commodity, estates, etc types of markets, plz seehttp://en.wikipedia.org/wiki/Financial_markets

Where is the best arbitrage opportunities considering the following most important factors :

1. I can get 8-10 arbs daily within 1-5% range

2. A market that can accept considerable high/unlimited amounts (atleast 100,000 per bet) --- a high turn over market

3. Reliable/Trusted

An experienced investor can answer me, he knows xactly what i mean to ask him/her

All answers/opinions/suggestions welcomed

Answer 1

nAH.  Not the easiest strategy because many people smarter than us have priced in the possibility of the buyout happening.  If they feel that the buyout will happen, then by the time you get in, there won't be too much profits to be made.

So many times there is not a lot of upside you can make by the time you get in, but if the merger doesn't happen, you will lose a lot since the stock price is already inflated because of the possibility of being bought out.

If you want to look into it though, this site has all the pending deals

http://www.arbitrageview.com/riskarb.htm

Answer 2

First of all there is no such things as risk free, even in arbitrage, just look at what happened to LTCM and their "risk free" arbitrage trading (it nearly blew up the entire bond market).

Most easy arbitrage opportunities are not available to small investors since large hedge funds have been using them and have squeezed spreads needed for profit to the point where profits dont cover trading costs in most instances.

There are zillions of arb opportunities, the most common of which are convertible bonds that can be turned to into stock shares and sold on the markets if their value is less than underlying stock.  Pairs trading is another type of arbitration where you pick two closely realted stocks and trade the relative moves between them being short the more expensive one and long the cheaper. There are also a lot dealing with options but I am not too familiar with them. Just know that a high volatility period can destroy ANY arb correltaions and blow such trading apart for a certain period of time.