Arbitrage within a single market

"Arbitrage" usually refers buying low in one market and then selling it in another market where it fetches a higher price. However, you can still use the principle of arbitrage within one market. EBay's consumer-to-consumer market is a good example of single-market arbitrage.

EBay sellers sometimes list their items with non-standard or misspelt keywords, which means that they may receive few bids or no bids for their items. In effect, this creates two submarkets for such items: — the "easy to find" submarket and the "hard to find" submarket. Prices are lower on the "hard to find" submarket.

You could practise eBay arbitrage by searching out these hard-to-find products, winning the bid at a very low price, and then putting the item up for auction with a standard keyword and sell it at the standard price.

Arbitrage often helps sellers in the lower-price market. As more arbitrageurs take advantage of the price differential between these two submarkets, the prices in the hard-to-find submarket will rise, bringing more profit to sellers who listed their items poorly.

There is no equivalent to single-market arbitrage in Ludopolis.

(Note that this article is using the term "arbitrage" in a non-standard way — the term is usually applied to nearly instantaneous transactions in securities markets.)