What context can I use each word in?
Learn when and how to use these words with these examples!
arbitrage
Example
The investor engaged in arbitrage by buying stocks on one exchange and selling them on another for a higher price. [arbitrage: noun]
Example
She is skilled at arbitraging currencies and making profits from the exchange rate differences. [arbitraging: present participle]
speculation
Example
He engaged in speculation by buying shares of a startup company hoping for a significant increase in their value. [speculation: noun]
Example
Many people speculate on the housing market, buying properties in anticipation of rising prices. [speculate: verb]
Good things to know
Which word is more common?
Speculation is more commonly used than arbitrage in everyday language, especially in the context of financial markets. Speculation is a widely known term, while arbitrage is more specific and often used in financial or investment discussions.
What’s the difference in the tone of formality between arbitrage and speculation?
Both arbitrage and speculation are formal terms used in financial contexts. However, arbitrage is more technical and commonly used in professional finance and investment discussions, while speculation can be used in both formal and informal settings.
