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4. a) What is arbitrage? And what are the different types of arbitrage? B) Can arbitrage strategies be risky when price convergence is not guaranteed?

4.

a) What is arbitrage? And what are the different types of arbitrage?

B) Can arbitrage strategies be risky when price convergence is not guaranteed? Clearly describe and outline 1 real-life example to highlight your answer

c) Outline and describe the risks faced as a trader when trying to secure a positive realised return from implementing a statistical arbitrage opportunity.

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