The Citi Pricing Anomaly Lives!

Good update from Donald Marron on his musings about the ongoing Citi pricing anomaly. With Citi having announced a share exchange, one would think that the pricing anomalies in Citi shares would be disappearing, but they are hanging tough — for now anyway:

That announcement, which hit the wires about 2:15pm on Monday, had the qualitative effects you would expect: the gap closed, with common shares promptly falling (down about 2.3% from 2:15 to the close) and preferred shares rising (the Series F preferred was up about 3.3%).

But the pricing anomaly persists.  At the close yesterday, you could have bought 1,000 shares of Citigroup for three different prices (using price quotes from Yahoo and ignoring transaction costs):

Simple          $3,420

Preferred      $2,898

Synthetic     $2,940

More here.

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  5. Google’s “Predatory” Pricing