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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
Page: 370
ISBN: 0470371978,
Publisher: Wiley
Format: pdf

302: LEVERAGE AND OPTIONS Merger arbitrage is a low-volatility strategy. The risk, of course, is that the deal falls through, and the spread widens quickly. By Thomas Kirchner Hoboken, NJ: John Wiley & Sons 2009. Arbitrageurs use leverage, short-selling, derivatives and synthetic securities (matching one asset with a combination of others with similar profit and loss profiles) to attempt to take advantage of discrepancies among prices. 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. Designed correctly, these strategies can yield profit on either side of the entry points. Special situations brokers have traditionally catered to merger arbitrage and event-driven funds. 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. Industry, serving traders looking to profit from events including corporate catalysts, takeovers, mergers and restructuring deals. Considering how the merger revival that so many strategists and analysts predicted has not occurred, the event-driven community is in all the same names. This is the flip side to merger arbitrage. Merger Arbitrage: How to profit from event-driven arbitrage. (See “Event Driven Strategies” for more details.) Liquidation arbitrage.