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how does one buy stock on NYSE, delist it and sell it on the LSE ( and take advantage of the price arbitrage ?

(Last Updated On: August 2, 2011)

how does one buy stock on NYSE, delist it and sell it on the LSE ( and take advantage of the price arbitrage ?

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Probably management of the company would be surprised to find out one day that they suddenly became listed on another stock exchange…

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but if the stock is listed on 2 exchanges…say for example HSBC is listed on hongkong as well as london stock exchange.
can i now buy from hongkong and sell the stock on lse ??

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I think it’s better if you contact your broker ans ask about what they offer. This needs to be done internally (within the same clearing house), in order to avoid huge time delays.

Furthermore, if the transaction involves different currencies, you need to clarify how they choose by which price the transaction will take place. You may find out that the price chosen by the clearing house is way off the price you had in mind, therefore the arbitrage advantage goes down the drain…

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can i now buy from hongkong and sell the stock on lse ??”

Of course, this is done by many arbitrageurs, now especially with HFT. A stock is not tied to a market but to a company. If the company’s stock is traded on different exchange, you can trade it on different exchanges. it depends on your broker.

Note that there exist ADR/GDR (Google for more details) but this is more complex. It allows a company to be “as if” it was listed on different market exchanges. Some traders do also arbitrage on that.

 

 

NOTE I now post my TRADING ALERTS into my personal FACEBOOK ACCOUNT and TWITTER. Don't worry as I don't post stupid cat videos or what I eat!

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