Simultaneous purchase and sale of highly correlated securities with discrepancies in value – also known as “pairs” trading.
Investing in companies that are being acquired, but whose shares are trading at a discount to the acquisition price. Involves assessing both the likelihood of the transaction closing and the timeline to its completion.
Simultaneous purchase and sale of convertible securities and common shares of the same issuer, respectively.
Seeks to capitalize on mispricing across different security classes within a company’s capital structure.