套利交易（合成报价） (Arbitrage trading (synthetic quotes))

A topic about arbitrage trading using synthetic quotes.

Example:
EURUSD = EURGBP * GBPUSD

So we need 3 quotes here.
EURUSD
EURGBP
GBPUSD

And then you will see that usually there is a small difference between the actual quote (EURUSD) and the synthetic quote (EURGBP*GBPUSD).

Now the idea is to take trade decisions based on this difference, this gap.

Example:
Buy EURUSD if the synthetic quote is 1.0 pip above the actual quote

Variations:
EURUSD = EURGBP * GBPUSD
EURUSD = EURNZD * NZDUSD
EURUSD = EURAUD * AUDUSD
EURUSD = EURJPY * 1/USDJPY
EURUSD = EURCAD * 1/USDCAD
EURUSD = EURCHF * 1/USDCHF

6 options by using to pairs to compute the synthetic quote.

Then you can create different models. For example, buy EURUSD if 2 synthetic quotes are 1.0 pip above the actual quote.

Or another one. Buy EURUSD if the average of 2 synthetic quotes are 1.0 pip above the actual quote.

Difficulties
There are many models that you can use.
Make sure that your broker allows this kind of trading.
Keep track of your execution, you are aiming for a tiny profit (in pips) which will get lost if your execution is not good.
The spread needs to be low, otherwise your tiny profit can't overcome the spread.

Are people here using this kind of trading strategies?