Just search here (the lens on this page) for "triangular arbitrage".
There a plenty of solutions and ways to calculate this problem.
Bare in mind that there is almost nothing that has not been coded for MT4/5 yet. You just have to search for it!
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- 2020.11.18
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Posible nearly answer is here
It seem to make
1lot EURUSD BUY
1lot EURGBP SELL
8.8 lot GBPUSD SELL
Am I wrong ?
Welcome more discussion.
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At noon , when implied price less than current EURGBP price,
I traded as
1.5 Lot BUY EURUSD is + 171usd
1.5 LOT SELL EURGBP is -458 usd
1 LOT SELL GBPUSD is +137 usd
total is - 140 usd
So my lot size is wrong?
Arbitrage trade is simutaneously trade to get profit within short time.
How you trade arbitrage in market?
There are quite a few rather big problems with tri-arbitrage for a retail trader.
In order to obtain a neutral position:
- The volumes needs to be exactly calculated. This is not possible with small lot sizes as it will distort a neutral position .
- Network latency can distort a neutral position.
- You can't use market orders, because slippage will distort a neutral position.
- You can't use limit orders either because you risk not getting filled and again will distort a neutral position.
In theory it will work, but unless you have the captial required, the infrastructure required AND a deal with a broker or LP to facilitate guaranteed filling at guaranteed prices, it is not going to happen.
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I want to triangulate EUR , USD , GBP
Let say here are their relationship.
EURUSD GBPUSD EURGBP
EURUSD=GBPUSD*EURGBP,
GBPUSD=EURUSD/EURGBP,
EURGBP=EURUSD/GBPUSD.
EURUSD Ask price is 1.17058
GBPUSD Ask price is 1.27390
EURGBP Ask price is 0.92345
Implied price calculation is as follow
· EURUSD/GBPUSD = 1.17058/1.27390 = 0.91890 (implied value we get)
EURGBP = CURRENT MARKET PRICE is 0.92345 > 0.91890
So we can get profit if sell at higher price
BUY EURUSD
SELL EURGBP
SELL GBPUSD
I want to know is how much lot need to buy and sell to get profit in forex market.
How calculate profitable lot size for each pair.
Thanks you.