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Would arbitrageurs be more effective at taking advantage of mis-pricings in the market if investors in...

Would arbitrageurs be more effective at taking advantage of mis-pricings in the market if investors in the arbitrageurs’ funds were only able to observe the performance of these funds occasionally (let’s say once a quarter) instead of continuously as is true today? Why?

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Answer #1

No this statement is not true because arbitraging is not that passive that one need to look once at the arbitrage in a quarter.

arbitrageurs need to be highly active according to the changing scenario of the different markets reactions. Arbitraging is highly active strategy in which arbitrageurs need to react proactive rather than reactive .

arbitraging is about taking advantage of mispricing at two respective exchanges, two different marketplace so an arbitrageur has to square of opposition before the opportunity lapses so he needs to be highly active in order to gain from the strategy.

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