Differentiate arbitration and speculation in foreign exchange market.
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Explanation:
. Differentiate “arbitration” and “speculation” in foreign exchange market. Ans. Arbitration is simultaneous purchase and sale of foreign exchangesin two or more markets to profit from discrepancies inquotations whereas A speculation in the Forex market means that youbuy and sell currencies.
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Arbitration and speculation.
Explanation:
- Arbitration is purchase and sales in the foreign market.
- It is considered as a less risk-taking factor than the speculation.
- It is mainly used by large, institutions or investors.
- On the other hand, speculation is limited to the foreign exchange market.
- With the image of having a large profit, they deal with the purchase and sale of their currency.
- It is like a stock exchange market.
Learn more about it.
What is arbitration? What can be reffereaf to arbitration?
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