Vagnoman has been training with the first team squad this season, but has yet to play a senior match for Hamburg because of his contract situation.
The 17 year old has reportedly been holding off signing a new deal, and the Gunners’ head scout Sven Mislintat is said to be very keen to snap up the defender.
Hamburg reportedly value the player at €3m, although they would much prefer the full back to stay rather than leave.
Vagnoman has come through the youth ranks at the Bundesliga club, having progressed from the Under 17 team to the Under 19s setup in July.
He has managed 18 appearances for Hamburg’s U19s this season, and has generally been used as a left back, although he has been employed on the right hand side on occasion.
The defender also performed well for Germany’s Under 17s at the World Cup back in October, as his team made it to the quarter finals.