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: