An investor who pursues profit from price inefficiencies.

This is attempted by making simultaneous risk-free trades that offset each other. For example, an arbitrageur could potentially profit from discrepancies between the prices listed on different exchanges on the same stock. In this case they would purchase the undervalued shares and short sell an equal amount of the overvalued shares, profiting at the convergence of the prices on the two exchanges. In this way, arbitrageurs contribute significantly to the maintenance of efficieny in the operation of capital markets.