On the Tokyo Stock Exchange. Honda Motor Company stock closed at 2,322 per share on March 19,2020 . Honda trades as and ADR on the NYSE. One underlying Honda share equals one ADR. On March 19, 2020, th /$ spot exchange rate was 109.33/$1.00. By comparison, Honda ADRs traded at $27.18. Do you think an arbitrage opportunity exists, and if so, how would you exploit it? Yes - sell the ADR, buy shares in Tokyo. No - the ADR and the Tokyo shares are not equivalent. Yes - buy the ADR, sell shares in Tokyo. No - the no arbitrage prices are too close