Arbitrage is the simultaneous purchase and sale of the same asset in different markets in order to profit from a difference in its price. Arbitrage is when an asset (stocks, currencies, etc.) is bought in one market and sold in another for a higher price.Arbitrage involves simultaneously purchasing and selling Assets in multiple markets to take advantage of price differences and generate profits. An example of arbitrage is when somebody buys a stock on one exchange for ten dollars and immediately sells it on another exchange for eleven dollars. Arbitrage is the strategy of taking advantage of price differences in different markets for the same asset. Develop business knowledge while preparing to transfer to a college or university. Bonds may be subject to certain federal taxes imposed only on certain corporations.