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Merger Arbitrage: How to Profit from Event-Driven Arbitrage by Thomas Kirchner

Merger Arbitrage: How to Profit from Event-Driven Arbitrage Thomas Kirchner ebook
Publisher: Wiley
Format: pdf
ISBN: 0470371978,
Page: 370

There are several variations of this strategy, one being merger arbitrage, in which a manager bets on the price of the company to be acquired, hoping it will be different from what the marketplace anticipates it will be. Source: Bloomberg Kyle Bass (tied). The fund, which seeks to profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns, is down 18 percent this year with the July loss. According to Mihaylo's calculations, INTL could be worth $28 after a recap, which is 5.6% more than shareholders would receive in the merger. A common trait is that the author of the opinion goes to great lengths to discredit their own findings that the merger consideration is at the low end of, or even below, the valuation range that they determine. This article was sent to people who get email alerts on . Merger Arbitrage - Many private investors have noticed that the stock of two companies involved in a potential merger or acquisition often react differently to the news of the impending action and try to take advantage of the shareholders' reaction. Event Driven – this strategy bases its investment on a particular event, a common example of which is investing in a “distressed” READ: bankrupt company. These banks benefit from the growth of the hedge fund industry as prime brokers make money on the interest they charge for debt financing and trading fees. Firm & Location: Hayman Capital Management, U.S.. Image courtesy of Hayman Capital. Paulson's Gold Fund, which can buy The firm's merger arbitrage, credit and recovery funds, which comprise more than 60 percent of the firm's $21 billion in assets, rose this year on the firm's “long event positions,” Paulson said today in the letter to clients. In KeyBanc's case, only the premium paid analysis looks Disclosure: Thomas Kirchner manages the Pennsylvania Avenue Event-Driven Fund [PAEDX], which owns shares of Max & Ermas Restaurants Inc. Most smaller event-driven funds in Asia are skewed towards softer catalyst opportunities: the firms that tend to really focus on risk arbitrage in Asia are global funds looking to deploy assets to the region. By James Williams – Athos Capital is a new merger arbitrage hedge fund founded by portfolio manager Matt Moskey, trader Erik Senko and former COO of Black's Link Capital, Fr. Convertible Arbitrage consists of hedge investing in convertible usually, being simultaneously long and short within the same sector, industry, capitalization, country, etc; Event-Driven consists of exploiting the price movement generated by a corporate event related to distressed stocks, mergers, takeovers, news, etc. With over 7,000 hedge funds, there the positions at a profit. Merger Arbitrage- How to Profit from Event-Driven Arbitrage. Event Driven - This scenario is triggered by corporate upheaval, whether it be a merger, sale of assets, some sort of restructuring or even bankruptcy. Merger Arbitrage: How to Profit from Event-Driven Arbitrage Publisher: W i l e y | 2009 | PDF | ISBN: 0470371978 | 355 pages | 15.5 Mb Written by a fund manager who invests solely in merger. Firm & Location: Paulson Partners, U.S.. Designed correctly, these strategies can yield profit on either side of the entry points.