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BlissBull

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BlissBull

Re: methodibd post# 2452

Friday, 07/23/2004 2:12:40 PM

Friday, July 23, 2004 2:12:40 PM

Post# of 51804
methodibd - The confusion is with point #3... if traders pay a premium for the qqq, that makes the qqq "overvalued" compared to the ndx (not undervalued).

Arbitrage is usually done via the futures market (long or short), or by buying or selling shares of the individual stocks in an index (or a combination of the two).

In this case, they would buy the ndx futures or component stocks, and sell qqq shares.

-Bliss







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