In this short note we show how virtual arbitrage opportunities can be modelled and included in the standard derivative …

We generalize the Arbitrage Pricing Theory (APT) to include the contribution of virtual arbitrage opportunities. We … correction to the APT due to the virtual arbitrage opportunities. The resulting relations reduce to the APT for an infinitely … fast market reaction or in the case where the virtual arbitrage is absent. Corrections to the Capital Asset Pricing Model …