# Arbitrage

*Derivatives & Options — Finicade finance glossary*

Earning a riskless profit by exploiting a price difference for the same thing in two places — buy where it's cheap, sell where it's dear. Real markets snuff these gaps out fast, which is exactly why 'no-arbitrage' is the master assumption used to price futures and options.

**Related terms:** [No-Arbitrage](https://finicade.com/glossary/no-arbitrage), [Put-Call Parity](https://finicade.com/glossary/put-call-parity), [Risk-Neutral Pricing](https://finicade.com/glossary/risk-neutral-pricing)

Source: https://finicade.com/glossary/arbitrage