This is our sixth update about new merger arbitrage related positions at funds that tend to have concentrated positions in their portfolio. You can find our first update here and our Q3 2024 update here. I mentioned the following in our last update about the number and kind of funds I am tracking:
“This has been a challenging year for merger arbitrage with multiple widely followed deals like Capri (CPRI) failing. Beyond the hit to my personal portfolio, I also saw the impact on the professional investors I follow who focus on risk arbitrage. When I first started this series of articles, I was tracking eight funds but one of them closed shop and I am dropping one more this quarter because their portfolio is more diversified and not concentrated in their top 10 positions. A third fund saw their concentration in the top 10 positions drop to 46% but I am going to retain them for now.