2007-01-12

Credit Card Arbitrage

Most people associate arbitrage with investment banks and millionaires who travel back and forth between Europe. Many people have no idea what it is -- it just sounds impressive and scary. It doesn't have to be that way, though.

Arbitrage is really about making money from other money. If I borrow money from you and pay you 5% interest, and I loan that money to someone else at 20%, I can make money. I earn a profit of 15%. That is based on the spread between what it cost me to borrow and what I earned in lending it.

It's how banks make most of their money.

Credit card companies are alwasy trying to lure new business and poach their competitors' customers. To do this, they offer ultra low interest rates.

If you're feeling adventurous, have a high credit score, and are dilligent about paying your bill, you may be able to profit from these agressive marketing tactics.

Welcome to the wonderful world of credit card arbitrage.

Arbitrage 01: Making Money From Credit Cards

Arbitrage 02: Pitfalls

Arbitrage 03: Credit Card Transfers Only

Arbitrage 04: On Line Savings Accounts

Arbitrage 05: My Process

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