Jump to ContentJump to Main Navigation
Inefficient MarketsAn Introduction to Behavioral Finance$
Users without a subscription are not able to see the full content.

Andrei Shleifer

Print publication date: 2000

Print ISBN-13: 9780198292272

Published to Oxford Scholarship Online: November 2003

DOI: 10.1093/0198292279.001.0001

Show Summary Details
Page of

PRINTED FROM OXFORD SCHOLARSHIP ONLINE (www.oxfordscholarship.com). (c) Copyright Oxford University Press, 2020. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in OSO for personal use. date: 30 March 2020

Professional Arbitrage

Professional Arbitrage

(p.89) 4 Professional Arbitrage
Inefficient Markets

Andrei Shleifer (Contributor Webpage)

Oxford University Press

Considers noise trader risk in the agency context of professional arbitrage. It elaborates on a performance‐based arbitrage model where arbitrageurs are affected by the inability of their investors to separate luck from skill, shedding further doubt on the effectiveness of arbitrage in achieving market efficiency. At the end, the chapter also briefly discusses the turbulence of financial markets in the summer of 1998, when Russia defaulted most of its debt, which vividly illustrated the limits of arbitrage.

Keywords:   arbitrage, financial market, Long‐Term Capital Management, noise trader risk, performance‐based arbitrage, professional arbitrage, Russia

Oxford Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs , and if you can't find the answer there, please contact us .