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Cross-venue price gap

Market makingEasy

The same contract is offered at an ask of $52$ on venue A, and venue B has a bid of $55$ for it. A trader buys $10$ units on A and sells $10$ units on B at those prices. What is the locked-in profit?

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Hint

Buy where it is cheap, sell where it is dear.

Solution

The trader pays $52$ and receives $55$ per unit.
The profit per unit is $55 - 52 = 3$ .
The locked-in profit on $10$ units is $30$ .

Answer: $30$

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