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FOREVER STAMP ARBITRAGE

step-by-step guide to profiting off a 3-cent hike on US postage stamps

h/t to Dan Primack at Fortune for posting this up early this Morning. AT

Yesterday, the US Postal Service (OTCPK:USPS) made a strange announcement: anybody who wants to turn a quick profit at its expense will have an opportunity to do so come January.

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What it actually said is that on January 26 next year, it wants to hike the price of a first-class stamp from $0.46 to $0.49. Stamp prices are normally increased by about 1 or 2 cents a year to match inflation. This 3-cent increase, which has to be approved by the US Postal Regulatory Commission, is large enough that it creates an opportunity for arbitrage in so-called "forever" stamps, which hold their value regardless of changes in postage price.