“We Are Unsure Whether To Wear A Helmet Or A Diaper” – Merger Arb Funds Crushed

Thursday, May 12, 2016
By Paul Martin

by Tyler Durden
ZeroHedge.com
05/12/2016

While company officers – who have given up on major stock upside as a result of busted M&A – and investment bankers are lamenting the bursting of the M&A bubble, some of the biggest losers are on the buyside, where merger arbs have seen billions in paper profits turn into billions in paper losses in moments upon the announcement of deal termination. Indeed, broken deals have whipsawed hedge funds that focus on merger arbitrage. As the NYT poetically puts it, according to one “arb” the current mood of the industry: “Every day is like showing up unsure of whether to wear a helmet or a diaper.”

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