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CASH-AND-CARRY ARBITRAGE Definition & Legal Meaning

Definition & Citations:

An ARBITRAGE strategy where a profit can be secured by borrowing funds, using the proceeds to buy the ASSET, and selling a FORWARD or FUTURE on that asset. The arbitrage only exists when the FORWARD PRICE is greater than the SPOT PRICE plus the COST OF CARRY. See also REVERSE CASHANDCARRY ARBITRAGE.

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