h periods may last for weeks or even
months, and during all of the time, London's immediate attitude toward
the market is apt to be the controlling influence on the movement of
exchange rates.

Concerning arbitraging in stocks, operations of this kind will be found
to divide themselves readily into two classes--trades which are closed
off at both ends at once, and trades which are allowed to run over
night or even for a day or two. The former is a class of business out
of which a dozen or twenty well-equipped houses in New York are making
a great deal of money. With an expert "at the rail" on the floor of the
New York Stock Exchange, and continuous quotations as to prices on the
various stock exchanges in Europe coming in, these houses are in a
position to take advantage of the slightest disparity in prices. The
chance to buy a hundred shares of some stock, in London, for instance,
and to sell it out at the same time in New York, at one-eighth or
one-quarter more, is what the arbitrageurs are constantly on the
lookout for. With the proper facilities, an expert, in the course of
the hour during which the London and New York Stock Exchanges are
simultaneously in session, is often able to put through a number of
profitable trades.

Such operations are possible, primarily, because of the fact that the
same influences affect different markets in different ways. A piece of
news which might cause a little selling of some stock in London, for
instance, might have exactly the opposite effect in New York. With the
wires continually hot between the two markets and a number of experts
on the watch for the chance to make a fraction, quotations here and
abroad can hardly get very far apart, at least in the active issues,
but occasionally, it does happen that the arbitrageur is able to take
advantage of a substantial difference. Always without risk, the bid in
one market being in hand before the stock is bought in the other
market.

But not so in the case of the other kind of arbitrage, where stocks
bought in one market are carried over night for the sake of selling
them out in some other market the next morning. There a decided risk is
taken, the success of the operation depending absolutely upon the
judgment of the operator. Under the stimulus of some favorable
development, for instance, which becomes known here only after the
Stock Exchanges abroad are closed for the day, the New York market
closes buoyant. The chances are that