Raising capital is most basic of all business activities. But as many new entrepreneurs quickly discover, raising capital may not be easy; in fact, it can be a complex and frustrating process. However, if you are informed and have planned effectively, raising money for your business will not be a painful experience.

This guide focuses on ways a small business can raise money.

There are several sources to consider when looking for financing. It is important to explore all of your options before making a decision.

Personal savings: The primary source of capital for most new businesses comes from savings and other forms of personal resources. While credit cards are often used to finance business needs, there may be better options available, even for very small loans.

By Gary Durkin © 2005

In simplest of terms, Arbitrage means to exploit price differential.

Usually it meant looking at differing sources of an investment, and if there was a price difference between Source A and Source B - then investor / dealer / broker / manager would buy from lower priced source, and sell on higher priced source.

Example:- The price of Stock ABC was $20 per share on Exchange XYZ The price of same Stock ABC on another Exchange 123 - was $15

The dealer would buy stock from Exchange 123 for $15 - then sell on Exchange XYZ for $20 - making $5 per share profit (minus costs).

Typically price differential was very small - and trading had to be extremely quick and liquid - otherwise markets could go against you in a very short time.

Ten years ago Arbitrage was more commonplace than it is today - for a number of reasons.

Nowadays, Arbitrage still exists, but either in limited formats and availability as direct arbitrage, or more commonly in Hedge Funds.

Hedge Funds can have Arbitrage as one of their investment methodologies / strategies - and you will find that many of past Arbitrage Managers have switched across to Hedge Funds.

Even after LTCM (Long Term Capital Management) scandal / fiasco a few years ago - Hedge Funds continue to grow, and today are biggest and fastest growing investment style in World.