Who does arbitrage, admit it now! :)

[Looser by Choice]

I can't believe the difference in price i see between some of the exchanges.
Haven't followed that before, but I suppose those big differences are quite rare and mostly due to the crazy fluctoations at mtgox?
Otherwise it looks like too damn easy to make lots of money arbitraging.

Or I'm missing something?
I'm not experienced trader so...

[keatonatron]

Search the forums--there have been multiple threads about it before.

One simple answer is: all exchanges take fees from every transaction, so with the high price of bitcoins (and the lagginess of Mt. Gox  ) it's not quite as profitable as it might appear.

Also, unless you want to withdraw cash from one exchange and move it to another (which can take days or weeks), you need the price unbalance to move back and forth between exchanges, which doesn't happen very quickly...

[essem]

I made 230 dollars in arbs yesterday during the crash

[b!z]

Btc-e $120
Mt Gox $150

Perfectly possible

[dandirk]

Yeah I have been looking at the differences as well.. bitfloor usually seems higher, I bought yesterday on Mtgox, transfered to bitfloor then sold. (yes I am a trading noob)

The problem as has been mentioned that while you can do this, you have to plan it out and constantly have money flowing in and out of all the exchanges to sustain these trades/transfers cause it takes days (or % fee) to get money in and out.  So if you setup your system where you have deposits coming in each day, and withdrawals doing the same (to fund the deposits)... you could make money just off the different exchanges.

Its easy to move coins around but even that delay can cause cause you to loose an opportunity as the windows close and exchanges catch up.

Or you could just just use another exchange and use mtgox as your predictor (if the other exchanges lags)... so when mtgox goes down, you watch your exchange and place a buy order, then when mtgox goes up, you know a raise is probably coming and place a sell.  My limited monitoring seems to indicate that each exchange seems slightly different but fairly constant... bitfloor seem to just have higher prices but the same swings happen as with mtgox but slightly later.  Yes it isn't fool proof but it seems pretty consistent.

[AndyRossy]

arnt there nearly (inifite) arb. bots alrdy?

[JimiQ84]

btc-e vs. bitstamp 100 vs 140 USD/BTC 

[seldon]

arnt there nearly (inifite) arb. bots alrdy?

They can only arbitrage the maximum cash they have available - then either wait for direction to reverse or transfer funds over other means (takes time). So the big differences can exist either ways for quick periods.

I was running one for gox vs. bitcoin-central until i figured 'screw this, I'm making more just holding coins' - that was two days ago, not the wisest decision so far

[keatonatron]

Another big problem (which exists not just for arbitrage but trading in general) is that under various circumstances you can't actually get the price you see. Sometimes on Gox the price will spike $10-20 one way or the other only for half a minute or so. Once you've put in an order, the price has already jumped back and it's too late.

If things don't move close to realtime, you might get lots of orders in on one exchange and not get any in at the other which doesn't help any.

Gox's lag is a notorious arb bot killer, I would imagine