Arbs face the future

In some ways, you could say that merger arbitrage lost its cachet even before the credit crunch hit home. The heyday seemed pat, even though there were more than a few hedge funds still playing the game. But the Financial Times notes the pickings are really slim these days. When there is a viable deal to bet on, the capital comes at it so fast that the share price rises to prohibitive levels. So we'll likely see more such funds move into more general macro strategies. Alternatively, they would make fewer bets and really target certain companies, a bit like activist funds.   

For more:
- here's the Financial Times article