What Is Factor Investing? Arbitrage is the simultaneous purchase and sale of the same asset in different markets in order to profit from a difference in its price.David Mann, our head of Capital Markets, Global Exchange-Traded Funds, discusses what could cause an ETF to trade outside its usual arbitrage bands. How Does Arbitrage Contribute to Market Efficiency? What Are the Most Common Pitfalls in Arbitrage Trading for Beginners? How to Invest in ETFs for Beginners. Exchange-traded funds let an investor buy lots of stocks and bonds at once.