Currency Arbitrage Calculator
Calculate potential triangular currency arbitrage profit or loss across three currency pairs to identify theoretical mispricings in forex markets.
Results
What is it?
Triangular arbitrage exploits price discrepancies between three currency pairs. By converting USD ? EUR ? GBP ? USD, a theoretical profit emerges when the rates are misaligned. In practice, electronic markets close these gaps in milliseconds, but the calculator is useful for understanding cross-rate math and spotting unfavorable travel money exchange chains.
How to use
1. Enter the current exchange rates for USD/EUR, EUR/GBP, and GBP/USD. 2. Enter your starting capital. The calculator traces the full triangle and shows how much USD you end with after three conversions, revealing any gain or loss.
Example scenario
$10,000 ? x0.92 = �9,200 ? x0.86 = �7,912 ? x1.27 = $10,048.24. Profit = $48.24 (0.48%). In reality, bid-ask spreads of 0.02�0.1% on each leg consume all profit for retail traders � but shows the math clearly.
Pro tip
For travellers, this calculator reveals if you are losing money by exchanging through intermediary currencies. Always compare the direct USD?target currency rate against the multi-hop route. Airport kiosks often have 5�10% implicit spreads � use a Wise or Revolut card to get interbank rates with small flat fees instead.