The most profitable trades exist in AI's blind spots. The delta between what AI thinks is true and what actually is.
Every model has gaps. Outdated training data. Biased datasets. Emergent hallucinations. These aren't bugs. They're arbitrage opportunities.
Trading the Gap
Traditional arbitrage exploited price differences between markets. Reality arbitrage exploits truth differences between models and world. The spread isn't cents—it's entire categories of mispriced reality.
The opportunity is temporary but renewable. Each model has new blind spots. GPT-5's errors won't be GPT-4's errors, but they'll exist. The profitable traders won't have better AI. They'll know exactly where AI touches reality and misses.
AI democratized analysis. It also democratized being wrong at scale. Everyone using the same models shares the same blind spots. That's not market failure. That's market opportunity.
The real alpha isn't in better AI. It is in knowing where AI ends and reality begins.