Arbitrage is about taking advantage of a price differential in one or markets and trade as to profit from a short term price divergance.

Typically this is done in pairs. More sophisticated arbitrage may involve three trades.

An arbitrage trade usually has a small gain but a high percentage of success, though sometimes situations can occur where big gains are made with low risk.

In the equities market an arbitrage trade may involve a long and short position of related stocks. In the case the net position is delta neutral as general market trends do not effect the profit of the net position.