<![CDATA[NRCIB: Closed my position for silly reasons]]>
  • The fundamentals of NRCIB have not changed much since my original writeup.
  • The price has gone up by roughly a third.  I have decided to take my profits and to reinvest them elsewhere.
  • It bugs me a lot that the borrow on NRCIB is around 4% and is much higher than NRCIA.  (This bugs me mainly because I cannot lend my shares out.)  It would make more sense if the cost of borrow was the other way around as I believe that the price ratio between NRCIB and NRCIA should be roughly 6:1.  The current ratio is around 2.7:1  ($39.29/$14.73).  The arbitrage trade is to short NRCIA and to go long NRCIB.

    • *Disclosure: No position in NRCIB or NRCIA.  I never shorted NRCIA because I dislike arbitrage trades that involve risk.

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