At the checkin counter there was a fellow passenger who randomly started talking to me. Let’s call him, Passenger A. Passenger A happens to be one of the most interesting individual’s I have met on a flight. If I could sum up his nature of business, it would be in international pricing arbitrage for (any) products. Passenger A, was very chatty and somehow ended up at the table next to me at the airport lounge in Dubai.
A definition of arbitrage is: Attempting to profit by exploiting price differences of identical or similar financial instruments, on different markets or in different forms (from Investorwords | What is arbitrage?). Arbitrage is not solely for the financial instruments, it is for products, commodities, etc.
Passenger A, was a former air crew member, who worked a good 20 years upwards traveling with Thai Airlines. During his transit times and layovers in different countries, he noticed that the pricing of products varied from country to country. This is where the international pricing arbitrage comes into play. He would exploit the price differences on similar products in different country markets.
For example, if Product X, was selling for $50 in Country A and for $200 in Country B. He would go and exploit the price difference of $150 for Product X and figure how to get Product X over from Country A to Country B and make his profit.
He now imports and exports large quantities of products internationally through his network of business associates throughout the world. The majority of his business associates were all made when he was traveling as an airline crew member. You can image with an airlines, such as Thai Airlines, he was able to travel extensively to many countries.
Passenger A, now, jets around the world conducting his business (buy and selling products taking advantage of international pricing arbitrage), travels business class and from his stories, parties like a rock star. We actually know all of this international pricing arbitrage exists, it just depends if one wants to take advantage of it. Passenger A did, and kudos to him.