Reference
Altcoin Arbitrage Glossary
Plain-language definitions for the market, model, execution, and risk terms used throughout this publication.
- Arbitrage
- A relative-value trade intended to capture a price or valuation difference. In practice, costs, execution, settlement, and residual risk determine whether the difference is actionable.
- Ask
- The price at which liquidity is offered for sale. A buyer generally evaluates executable asks, not the mid-price.
- Basis
- The difference between a derivative price and a reference spot price, often considered together with time, financing, and settlement.
- Beta
- An estimate of how an asset or portfolio tends to move with a market factor, such as Bitcoin. Beta is model-dependent and can change.
- Bid
- The price at which liquidity is offered to buy. A seller generally evaluates executable bids.
- Cointegration
- A statistical property in which a weighted combination of nonstationary series may be stationary over a sample. It does not guarantee future convergence.
- Cross-Venue Arbitrage
- A route that compares and executes an economic asset or hedge across two or more venues, typically using pre-positioned inventory.
- Executable Edge
- The conservative expected result after depth, fees, impact, financing, gas, uncertainty, and risk constraints—not merely a displayed spread.
- Funding Rate
- A periodic payment mechanism used by many perpetual futures. The direction and amount can change by venue and interval.
- Hedge Ratio
- The quantity relationship between two legs intended to offset a modeled exposure or define a spread.
- Inventory Band
- A permitted range for an asset balance or exposure at a venue, chain, or portfolio level.
- Leg Risk
- The risk that one part of a multi-leg trade executes while another part does not execute as intended.
- Market Impact
- The change in achievable price caused by consuming liquidity or signaling trading interest.
- MEV
- Maximal extractable value associated with transaction inclusion, exclusion, or ordering in a block-production system.
- Pair Trading
- A relative-value approach that takes opposing positions in two assets according to a modeled relationship.
- Price Collar
- A control that rejects an order or transaction outside an approved price range.
- Reconciliation
- The process of matching intended actions with acknowledgments, fills, fees, transfers, positions, and balances.
- Slippage
- The difference between an expected price and the average price actually achieved, including effects of depth and changing markets.
- Statistical Arbitrage
- A family of systematic relative-value strategies that uses statistical forecasts and portfolio construction across one or more assets.
- Triangular Arbitrage
- A conversion loop among three assets or pairs intended to end with more of the starting asset after all costs.
- Z-Score
- A standardized measure of how far a value or spread is from an estimated mean in units of estimated standard deviation.
Put the terms together
From spread to settled outcome
The foundational guide connects these definitions through a complete altcoin arbitrage workflow.
Read the foundational guide →