- 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.