arbitrage

(redirected from arbitrages)
Also found in: Dictionary, Legal, Financial, Encyclopedia, Wikipedia.
Related to arbitrages: arbitrageurs
  • all
  • noun
  • verb

Words related to arbitrage

a kind of hedged investment meant to capture slight differences in price

practice arbitrage, as in the stock market

References in periodicals archive ?
Harnessing the costs of international tax arbitrage will not always be the appropriate response to every particular international tax arbitrage transaction, but it should be considered when other, more traditional responses prove inadequate.
1) For example, in statements to the Tax Section of the American Bar Association, Hal Hicks, Internal Revenue Service (Service) associate chief counsel (international), stated that "[p]ractitioners should expect the Service to focus on international tax arbitrage during 2006, especially on how U.
3) The primary reason why this aspect is unique to international tax arbitrage as opposed to other conflicts of laws, such as the overlap of U.
A further refinement proposes that an aspect unique to international tax arbitrage is "rule indifference," meaning that the taxpayer is indifferent to whether either rule on its face provides a tax subsidy or preference but rather that the combination of two such rules results in net worldwide tax savings.
5) With respect to the DRC arbitrage transaction, the United States adopted the second alternative, denying an interest deduction to the DRC involved in the arbitrage transaction.
The check-the-box regulations and their use in international tax arbitrage are later discussed in more detail.
9) A more subtle but similar version of this international arbitrage transaction was marketed under the name of "foreign leveraged investment program" (FLIPs).
I]nstances of "pure" tax avoidance typically involve "purely paper transactions" that attempt to arbitrage differences in tax treatment without altering the desired pattern of cash flows associated with a particular transaction.
GHOSH, ARBITRAGE HEDGING AND SPECULATION: THE FOREIGN EXCHANGE MARKET 1-2 (2004).
Tax arbitrage will not generally be perfectly self-correcting, depending on the size of the tax preference and the ability of markets to price the attribute through trading, since only one taxpayer need face a marginal tax rate higher than the rate priced into the asset for the arbitrage to be present.
Since international tax arbitrage arises due to the different legal regimes and not the source of economic investment, however, this will not necessarily be the case.
18) Once this process begins, under the theory of path dependence it is possible that the international tax arbitrage will continue whether or not it remains as advantageous to taxpayers as it was at the time the transaction initially arose, especially if (under a public choice model) the arbitrageurs act as a unified interest group.
taxpayers, which would indicate that either international tax arbitrage contributes a significant portion of these savings or that its use will grow as the primary remaining method to further reduce worldwide effective tax rates.
International tax arbitrage incurs numerous non-tax frictions.
45) Almost immediately after the check-the-box regulations were promulgated, their ability to be used for tax planning, particularly their use in connection with international tax arbitrage, was identified by taxpayers.