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Merger Arbitrage Blog

Year 2017 Review

The year 2017 is coming to an end. Trading wise, I had a wonderful year with some bumper profits. My trading strategy does not allow me to take on too many trades as it takes time and effort to analyse merger arbitrage trades. 

In total I participated in 21 different merger arbitrage trades, resulting in 5 losses and 16 wins. I did not include those that have not closed as of today such as Monsanto, Time Warner and Fortress Investments. 

As seen from the chart above, my biggest wins are concentrated on three names (Syngenta-47.5% of profits, Cabela-22% of profits, Brocade-26.6% of profits). My strategy for merger arbitrage involves allocating majority of my trading capital on my conviction buys. The next biggest contributors (Tribune Media and Mobileye) are only 1.87% and 1.60% of the profit earned.

Ideally in the coming year, I would like to spread out my capital allocations more evenly so that my risks are also spread out.  The chart below shows the details for my trading performance:

 

Updated: December 28, 2017 — 6:37 am

8 Comments

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  1. Nice job 🙂

     

    and looks like FIG closed too.

    Are you going to enter Akorn? I sold 1000 puts Jan. as a start.

  2. Wow thats a big position..so far i sold only 28 puts… The puts spike up today..i may buy more

  3. Maybe I was misleading 10 puts ( being 1000 shares if I have to buy ).  If it keeps dropping, I will be buying shares.

  4. here's our chance…$30 Jan puts are now selling for $0.75-$0.80

  5. congrats on a great year! Out of curiosity, how much capital was needed to generate these returns? 

    1. thanks! i am using IB CFD for big trades… low margin at 10%… for SYT i ultimately bought $500k worth… for BRCD i had $800k worth… 

      1. ok, thanks for sharing. Don't think CFDs are allowed in US, so will have to put more money to work here 🙂

        1. yes..CFDs not allowed for U.S citizens. I m in Singapore. However, even at 25% margin for margin accounts its still good. 🙂 

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