Entrepreneurs Aren't Risk Takers - They're Arbitrageurs

http://www.siliconindia.com/magazine/prnt.php?DYN737147807

by jakarta • 17 years ago

23 6 17 years ago

siliconindia.com

Dilpil• 17 years ago

If you ignore opportunity costs and assume no money is borrowed, then yes, there is no risk.

macco• 17 years ago

Good point. Futher the price of rolling your own is probably higher than just the dollars you spend.

AlphaMonkey2• 17 years ago

Not to mention that only in textbooks can one find perfect risk-free arbitrage opportunities. Unfortunately, the real-world offers only quasi-arbitrage opportunities. Fortunately, contrary to what some academics believe, such opportunities do exist.

andrewljohnson• 17 years ago

Hmm, this is technically true, but life does provide some actual very close to ideal arbitrages.

For example, back in the day, I used to buy and sell a popular collectible card game on eBay. Right when eBay came out, there was a massive arbitrage on buying cards from people and selling them online, because there were huge geographic price discrepancies. There was no risk in buying a card for .50 and selling it for $8, etc.

Eventually, the market corrected itself and prices stabilized, but for a while, there was a lot of money to be made if you just knew the right cards to buy.

Another example of this sort of temporal arbitrage is sports betting right before the country was networked well. It used to be if you had a guy on the coasts and in various major metropoli, you could place bets on games with varying handicaps, and always win.

The famous poker player Howard Lederer made a lot of money this way.

ohashi• 17 years ago

He seems to think there are no barriers to anything... IP, first-mover advantages, etc mean nothing apparently.

Entrepreneurs Aren't Risk Takers - They're Arbitrageurs

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