There is value in clarifying which definition is being used. That is, I hope, what I’ve been doing here, in opposition to the notion that there is only one sense that can be used and so any clarification is nonsense.
And while strong arbitrage is nice in having 0 risk as opposed 0.1 risk or 0.11 risk, we experience no trouble in real life because some words can be made to overlap despite their average & typical uses. Expected profits or edges don’t necessarily cover the same mental ground; if I buy and hold indexes for 50 years, I might expect a profit, but few would call that arbitrage.
“The sense of a sentence—one would like to say—may, of course, leave this or that open, but the sentence must nevertheless have a definite sense. An indefinite sense—that would really not be a sense at all. - This is like: An indefinite boundary is not really a boundary at all. Here one thinks perhaps: if I say ‘I have locked the man up fast in the room—there is only one door left open’ - then I simply haven’t locked him in at all; his being locked in is a sham. One would be inclined to say here: ‘You haven’t done anything at all’. An enclosure with a hole in it is as good as none. - But is that true?”
What you’re doing is purposefully diluting the word. “Arbitrage” as a word exists to talk about riskless profit. You’re trying to introduce risk to it, to what end?
You know, the first definition in the OED doesn’t even have anything to do with finance—it’s simply the decision of an arbitrator. The second is ‘exercise of individual judgement’. Only the third includes the commercial definition, and that (and its quotes from the 1800s on) speaks only of buying and selling in geographically disparate areas. Nothing about risk. Indeed, the 1882 quote goes ‘He cannot tell what the outcome will be… of this unfathomable arbitrage business.’
‘Arbitrage’ did not begin as the strong definition. It did not exist as finance at all. The strong definition is a 19th and 20th century technical addition to a word imported from the French. I am purposefully diluting it? How can I dilute something which was never pure to begin with?
Again, explain whether you are speaking descriptively or prescriptively when you say ‘arbitrage exists to talk about riskless profit’. If the former, you are manifestly wrong and have been wrong for the last 600 years according to the OED. If the latter, then why should we abandon all the other meanings?
You’re right—arbitrage as a word doesn’t exist to talk about riskless profit. Arbitrage as a financial term, however, exists to talk about riskless profit.
You’re right—arbitrage as a word doesn’t exist to talk about riskless profit. Arbitrage as a financial term, however, exists to talk about riskless profit.
It would seem that taw was using the more general meaning and not the financial term.
There is value in clarifying which definition is being used. That is, I hope, what I’ve been doing here, in opposition to the notion that there is only one sense that can be used and so any clarification is nonsense.
And while strong arbitrage is nice in having 0 risk as opposed 0.1 risk or 0.11 risk, we experience no trouble in real life because some words can be made to overlap despite their average & typical uses. Expected profits or edges don’t necessarily cover the same mental ground; if I buy and hold indexes for 50 years, I might expect a profit, but few would call that arbitrage.
--Wittgenstein, Philosophical Investigations, 99
What you’re doing is purposefully diluting the word. “Arbitrage” as a word exists to talk about riskless profit. You’re trying to introduce risk to it, to what end?
You know, the first definition in the OED doesn’t even have anything to do with finance—it’s simply the decision of an arbitrator. The second is ‘exercise of individual judgement’. Only the third includes the commercial definition, and that (and its quotes from the 1800s on) speaks only of buying and selling in geographically disparate areas. Nothing about risk. Indeed, the 1882 quote goes ‘He cannot tell what the outcome will be… of this unfathomable arbitrage business.’
‘Arbitrage’ did not begin as the strong definition. It did not exist as finance at all. The strong definition is a 19th and 20th century technical addition to a word imported from the French. I am purposefully diluting it? How can I dilute something which was never pure to begin with?
Again, explain whether you are speaking descriptively or prescriptively when you say ‘arbitrage exists to talk about riskless profit’. If the former, you are manifestly wrong and have been wrong for the last 600 years according to the OED. If the latter, then why should we abandon all the other meanings?
You’re right—arbitrage as a word doesn’t exist to talk about riskless profit. Arbitrage as a financial term, however, exists to talk about riskless profit.
It would seem that taw was using the more general meaning and not the financial term.