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You basically are betting for the same outcome in two different ways, full exposure. I don't see how this is arbitrage.
by kbody 10y ago
You basically are betting for the same outcome in two different ways, full exposure. I don't see how this is arbitrage.
- milcron 10y agoYou're betting on the merger going through, but keep a net-neutral exposure to whether the stock goes up or down.
- kryptiskt 10y agoIt's merger arbitrage, the exposure is against the merger going through or not. The market is filtered out. LTCM lost a bundle on it when they were hunting opportunities at the end.