Arbitrage Financial News

arbitrage funds, pouring in as much as Rs 10,074 crore in July, with cumulative flows rising to Rs 23,800 crore this financial year. The inflows reflect high returns and better taxation treatment these funds offer compared to debt plans.What is an arbitrage fund? How does it generate returns?An arbitrage fund seeks to generate returns on the price differential in the cash and futures market. In such a scheme, the fund manager simultaneously buys a company in the cash market and sells an equivalent quantity in the futures segment as long as the futures trade at a reasonable premium. The spread between the two generates the return for the scheme. The fund does not take any naked exposure to any individual security or an index as each buy transaction in the cash market has a corresponding sell transaction in the futures market. While 65% of the corpus is allocated to arbitrage products, the fund manager is free to choose the balance of 35% between arbitrage or debt products, depending on his view on the market.Why is it gaining popularity with investors?High returns compared with savings accounts and better taxation are driving investors to arbitrage funds. Rich investors also prefer these funds as they are treated as equity funds for taxation, which significantly increases post-tax returns. Investors holding for less than a year pay 15% capital gains tax, while if they sell after a year they pay only 10% long-term capital gains tax for gains above Rs 1 lakh. Compared to this in a debt fund, rich investors have to pay short-term capital gains tax at 30%.

New Delhi (India), August 11: Blockchain and cryptocurrencies are shaping a new era of economics, and one player has quickly become a game-changer in the crypto arbitrage market within just one year since its creation on August 12, 2022. Meet CAT, short for Crypto Arbitrage Team, offering a safe way for people to make money from crypto arbitrage.

Tata Motors' shares with Differential Voting Rights (DVR) rose as much as 17% to an all-time high in trading on Wednesday as traders lapped up the stock to bet on an arbitrage opportunity with their ordinary listed shares. The buying frenzy followed the announcement by Tata Motors to cancel class 'A' shares, also known as shares carrying differential voting rights or DVR, and convert them into ordinary shares. DVR shares trade like ordinary shares but with lower voting rights.

HDFC Bank, rallied over 3% to Rs 2,911 in Monday's early trade on BSE even as traders saw arbitrage opportunities ahead of the announcement of the delisting date. With investors raising a toast to the mega-merger deal that would lead to the creation of the world's fourth largest bank by market value behind only JP Morgan, ICBC of China and Bank of America, HDFC Bank shares also rallied over 2% to Rs 1,738. «The merger of HDFC Bank and HDFC Ltd will create a behemoth (FY24 loans at Rs 25 tn, 15.7% market share) that can deliver strong growth (~17% loan CAGR) and profitability (~2% RoA).

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The digital currency market is still struggling to exit the extended bear run and Bitcoin owners are turning to interest-bearing wallets as the best way to make a consistent profit in the current crypto climate.

MEV gain, an Ethereum (ETH) arbitrage trading bot built by MEVbots, which claims to provide stress-free passive income, has been actively draining its users’ funds via a fund-stealing backdoor. 

Token at the Center of Crypto Storm Becomes Arbitrage Target

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The end of the year is normally a time to wind down and prepare for the holiday season, but the last few weeks of 2021 saw a crypto market that showed no signs of resting. 

cryptocurrency exchanges on the number of platforms — and the possibility of price arbitrage. Sources close to the discussions told ET that concerns are being raised around the number of cryptocurrency exchanges operating out of India and how prices of the same cryptocurrencies tend to differ at the same time across platforms creating arbitrage opportunities. The government has held several meetings over the last few days thrashing out issues with the crypto stakeholders.