Core Viewpoint - The article discusses the concept of "offshore fund arbitrage," emphasizing that it is not a speculative tactic but a strategy to profit from price differences or time windows in fund trading rules. Group 1: Offshore Fund Arbitrage - Offshore fund arbitrage is based on the principle of "buy low, sell high" or "earning time differences through rules," but it is important to note that there is no risk-free arbitrage [1]. - All operations must account for costs and control risks, ensuring that profits exceed costs before proceeding [1]. Group 2: LOF Fund Arbitrage - The easiest arbitrage method for individual investors involves LOF funds (Listed Open-Ended Funds), which can be traded both off-market at net value and on-market at market price [3]. - When the on-market trading price exceeds the off-market net value, a "premium arbitrage" opportunity arises, allowing investors to buy low off-market and sell high on-market for profit [3]. Group 3: Practical Steps for LOF Arbitrage - Step 1: Select targets by using tools like Jisilu to find LOF funds with a premium rate of at least 3% and a daily trading volume over 10 million, avoiding those with suspended subscriptions [4]. - Step 2: Purchase the selected LOF A shares through platforms like Alipay or Tian Tian Fund, and after confirmation (usually T+2 days), initiate a "cross-system transfer" to a brokerage [4]. - Step 3: After the transfer application is submitted, the shares will arrive in the securities account on T+2 days, and investors can sell them like stocks [5]. Group 4: Example of LOF Arbitrage - An example is provided where a certain S&P 500 LOF has a premium rate of 25.9%, with an off-market purchase net value of 1 yuan and an on-market trading price of 1.259 yuan, leading to a potential profit of approximately 0.2 yuan per 1 yuan invested after deducting fees [6]. Group 5: ETF Arbitrage - ETF arbitrage was traditionally exclusive to institutions, but individual investors can participate through offshore ETF linked funds, which invest primarily in corresponding ETFs [7]. - The core logic involves taking advantage of the lag in net value response of linked funds when ETFs are at a premium or discount [7]. Group 6: Directions for ETF Arbitrage - Premium arbitrage occurs when the on-market price of an ETF exceeds its net value, allowing for off-market purchases of linked funds, followed by redemption for profit once the net value rises [8]. - Discount arbitrage happens when the on-market price is lower than the net value, allowing for redemption of linked funds and re-purchase at a lower net value for profit [9]. Group 7: Key Considerations for Arbitrage - It is crucial to calculate costs accurately, ensuring that arbitrage profits cover all fees, as a premium rate below 3% may lead to losses [11]. - Control time risks, as the transfer and confirmation processes require time, during which market fluctuations may erode profit margins [12]. - Confirm liquidity by selecting LOF/ETF targets with high daily trading volumes to avoid difficulties in selling once transferred to the market [13]. - Adhere to rules, ensuring accounts are in the same name and that shares are in whole numbers during transfers to avoid arbitrage failures [14]. - Avoid excessive greed; new investors are advised to start with small amounts to familiarize themselves with the process before scaling up [15].