	RAINMAKER MARKETING CORPORATION 281.537.1200

Arbitrage & The "Gordon Gekko Myth"...

Whenever a discussion on investment strategies is undertaken, sooner or later someone brings up the subject of arbitrage. Most people hear the word and think of the character Gordon Gekko out of the movie Wall Street and immediately have visions of empire... and vast banking and wealth conspiracies... and arbitrageurs like T. Boone Pickens and the infamous Hunt brothers.

Arbitrage Explained...

	With respect to investments in securities, arbitrage exists whenever and wherever there are market inefficiencies, as arbitrage "works" to correct market inefficiencies. Once the market becomes efficient (selling price offer and buying price bids closely match one another), the arbitrage opportunity no longer exists and the trader moves on to the next opportunity area. The current subjective risk elements that plague the stock market exchanges serve to continually create inefficiencies that allow for this type of investment manipulation and security speculation.
	Think of arbitrage as a traffic jam. A traffic jam is an extreme example of an inefficient operation of highways and motorists respond by constantly switching from the slow moving lane to the faster moving lanes seeking to keep moving at optimum speed. When the traffic jam is cleared, the "traffic arbitrage" game is over - until the next traffic jam is encountered and then the game starts over. The same is true with security investment arbitrage - when the difference between the offered sale price of a security (or commodity) and the bid price to buy that same security is great enough, the arbitrageur steps in and takes a middleman position until the price gap closes to a point where the arbitrageur can no longer make a substantive profit on buying and reselling the security of commodity.
	Day trading is the most extreme example of high-risk arbitrage in that most day traders are assuming that excess market capacity exists for trading of a given security and they are literally betting on the change of a given security's price within the course of a single day (up or down) where no pre-existing market inefficiency is found.

You need to be thinking about what you are trying to accomplish.

Do You Know The Secret?

When it comes to commercial real estate development finance, it doesn't matter whether you need to raise $5 million or $50 million, the out-of-pocket costs, advance fees and project due diligence costs will always require the same relative investment dollars the promoters have to fund. Do you know what that amount is? Do you know the Secret?

Rainmaker Marketing Corporation can trace its history back all the way to 1989. Incorporated in 1993, Rainmaker Marketing Corporation has evolved over time into a full-service business to business consulting firm. Rainmaker Marketing Corporation’s initial specialization was in issues and documentation needs corresponding to the capital funding cycle for commercial real estate development projects with a primary focus on senior housing and health care related properties. Today, Rainmaker Marketing Corporation serves all types of commercial income-producing property development program financing requests with a combination of feasibility studies, due diligence services, structured finance consulting and a focus on commercial real estate syndication services. Rainmaker Marketing Corporation’s service area includes all of the continental United States, Canada, Mexico and the Caribbean Basin.

281.537.1200

Email: consultants@rainmakermarketing.com

Commercial Real Estate Development Finance, Due Diligence Documentation, Syndication & Project Management Consulting

15519 Dawnbrook Drive, Houston, Texas 77068.