Arbitrage

Profiting from price discrepancies between two related securities or markets. Pure arbitrage is risk-free in theory; in practice, transaction costs, latency, and execution risk eat most opportunities.

Common forms: index arbitrage (futures vs. cash basket), merger arbitrage (target stock vs. bid price), convertible arbitrage (convertible bond vs. underlying stock), statistical arbitrage (mean-reverting pairs). The lowest-hanging arb fruit are picked instantly by HFT firms.