RRD - PYS: The Biggest Arbitrage In Fixed Income At The Moment
As the holidays are approaching, it is time to share with the public one of our top ideas for the new year. Our readers are probably familiar with this arbitrage trade, but the arbitrage keeps on widening. The undervalued product in this arbitrage is ML Depositor PPLUS Trust 6.30% R.R. Donnelley Certificates RRD-1 (PYS), while the overvalued product is the 6.625% bond of R.R. Donnelley (RRD) maturing on 4/15/2029, CUSIP 257867AG6.
Road map of the article
- Explanation of the product and how a third-party trust works
- All the metrics of the instrument in question
- Comparison