While the difference between someone who is running a business and an entrepreneur should be clear by now (we’ve touched on it a few times in previous posts), there are certain traits which distinguish the true entrepreneur from someone who’s just started and operated a string of businesses. The entrepreneur is in love with the process of either creating or discovering an opportunity to make money, therefore the industry or field in which this is done doesn’t really matter.
While I perhaps don’t quite have the drive (not yet anyway) to operate as one myself, I reckon being an arbitrageur is the ultimate manifestation of what an entrepreneur is! An arbitrageur epitomises the very idea of seeking out opportunity to profit where none seems to be in existence because they rely on volume (the mobilisation of the masses) to rack up what seem like very small profits. These tiny profits add up very quickly however and then we all turn around and marvel at just how someone literally managed to manufacture big profits for themselves, out of thin air.
So what is an arbitrageur?
It’s a term that originates from the good old financial sector, referring to someone who essentially compares the markets over which they can buy and sell the same securities who then goes on to buy those securities from the market where they’re available cheapest and re-sells them on the markets where they’re sold at a higher price. The difference (arbitrage) is so small that many people consider this practice to be a bit too time consuming with too little returns, but that’s what distinguishes those who are made for this and those who should rather look elsewhere. As mentioned, the profits can add up really quickly if you get the volume right.
For the purposes of this discussion, I’m referring to an arbitrageur who exists on the entrepreneurial level, not necessarily the typical arbitrageur as defined within the scope of the financial industry. You’d otherwise be limiting yourself if you only played within the financial sector because the principles of arbitrage become that much more powerful at an entrepreneurial level, beyond the financial sector.
You definitely have to develop good analytical skills if you want to be an entrepreneurial arbitrageur because therein simply lies the advantage of being able to spot opportunities for the building up of incremental profits, no matter how small they are. Not everyone in this world can merely look at a site like superbonuscode.co.uk for instance and spot a great opportunity to operate as an arbitrageur of sorts. I mean it’s a bonus code which anyone can claim to get some extra credits for their online gaming exploits, but an arbitrageur might perhaps want to take a deeper look at the whole bonus structure and ask questions like how are online betting platforms able to give away such big credit bonuses and just who they distribute those bonuses through.
Patience is another virtue you’ll need to have if you want to be an arbitrageur as the process often entails chasing what ultimately turn out not to be arbitrage opportunities worth the time.