Risk Arbitrage: An Investor's Guide (Hardcover)

by Keith M. Moore (Author) "bull markets such as we have experienced over the past decade. The reason lies in the fact that the arbitrageur is generally trying to earn..." (more)
Key Phrases: present principal occupation, required signature guarantees, risk arbitrage business, Office Depot, Federal Trade Commission, Wall Street (more...)

Editorial Reviews

Product Description
The current wave of corporate mergers, acquisitions, restructurings, and similar transactions has created unprecedented opportunities for those versed in contemporary risk arbitrage techniques. At the same time, the nature of the current merger wave has lent such transactions a much higher degree of predictability than ever before, making risk arbitrage more attractive to investors of every stripe. Yet, surprisingly, there continues to be a near-total lack of instructional material for those interested in learning the latest risk arbitrage techniques.

Now, in the first insider's guide to risk arbitrage to appear since Ivan Boesky's 1985 classic, Merger Mania, one of Wall Street's most successful risk arbitrageurs draws upon his three decades of experience to arm you with the knowledge and skills you need to know to make this powerful investment strategy work for you.

Taking a systematic approach, Keith M. Moore gets you quickly up to speed on basic risk arbitrage concepts, terminology, and equations. He then walks you, step-by-step, through all the elements of the risk arbitrage process. And, with the help of numerous case studies and vignettes, he describes a complete methodology for safely navigating your way through the world of risk arbitrage. From researching prospects and determining your position, to hedging and trading tactics, Moore arms you with the full complement of sophisticated risk arbitrage techniques with which he has consistently realized substantial returns for his clients and himself.

Risk Arbitrage is must reading for finance and investment professionals who want to take advantage of the nearly limitless opportunities afforded by today's rapidly changing global business environment.

Keith M. Moore is Managing Partner of Jupiter Capital LLC, a hedge fund specializing in risk arbitrage. Prior to founding Jupiter Capital, he was a partner at Neuberger Berman, in charge of that firm's merger arbitrage and convertible arbitrage activities and a senior vice president in charge of merger arbitrage at Donaldson, Lufkin & Jenrette. Mr. Moore is also an adjunct professor of finance at New York University's Stern School of Business and an adjunct member of the faculty at the University of Rhode Island.

Praise for Risk Arbitrage An Investor's Guide

"Never in history have there been so many mergers and takeovers like those in the late '90s! Keith Moore's Risk Arbitrage: An Investor's Guide is the first systematic attempt to break the silence around the secrets of the investment and trading strategy that exploits these corporate restructurings: risk arbitrage. This is not just a book about the secrets of risk arbitrage but a real textbook and investor's guide on how to trade the risk arbitrage special situations and about the risk arbitrage industry including hedge funds." —Gabriel Burstein.

Head of Specialized Equity Sales and Trading

Daiwa Europe, London

"I am delighted that Keith Moore has been able to write a book describing the business of risk arbitrage in such a user-friendly way. This is a work that will prove useful to investors ranging from novices to professionals and should be especially helpful to those teaching finance courses at our colleges and universities. Congratulations, Keith, on accomplishing what none of your predecessors could." —George A. Kellner CEO, Kellner, DiLeo & Co.

"This book fills a surprising void on the subject of arbitrage at a time that could not be more propitious. It is written clearly and comprehensively and should be helpful to all who are interested in the subject, regardless of experience." —Albert B. Cohen Albert B. Cohen Partners, LP.

From the Inside Flap
The current wave of corporate mergers, acquisitions, restructurings, and similar transactions has created unprecedented opportunities for those versed in contemporary risk arbitrage techniques. At the same time, the nature of the current merger wave has lent such transactions a much higher degree of predictability than ever before, making risk arbitrage more attractive to investors of every stripe. Yet, surprisingly, there continues to be a near-total lack of instructional material for those interested in learning the latest risk arbitrage techniques. Now, in the first insider’s guide to risk arbitrage to appear since Ivan Boesky’s 1985 classic, Merger Mania, one of Wall Street’s most successful risk arbitrageurs draws upon his three decades of experience to arm you with the knowledge and skills you need to know to make this powerful investment strategy work for you. Taking a systematic approach, Keith M. Moore gets you quickly up to speed on basic risk arbitrage concepts, terminology, and equations. He then walks you, step-by-step, through all the elements of the risk arbitrage process. And, with the help of numerous case studies and vignettes, he describes a complete methodology for safely navigating your way through the world of risk arbitrage. From researching prospects and determining your position, to hedging and trading tactics, Moore arms you with the full complement of sophisticated risk arbitrage techniques with which he has consistently realized substantial returns for his clients and himself. Risk Arbitrage is must reading for finance and investment professionals who want to take advantage of the nearly limitless opportunities afforded by today’s rapidly changing global business environment.

See all Editorial Reviews

Product Details

• Hardcover: 304 pages
• Publisher: Wiley (September 6, 1999)
• Language: English
• ISBN-10: 0471248843
• ISBN-13: 978-0471248842
• Product Dimensions: 9 x 6.2 x 1.1 inches
• Shipping Weight: 1.4 pounds (View shipping rates and policies)
• Average Customer Review: 3.5 out of 5 stars See all reviews (13 customer reviews)
• Amazon.com Sales Rank: #432,530 in Books (See Bestsellers in Books)

Customer Reviews

Most Helpful Customer Reviews

24 of 25 people found the following review helpful:

4.0 out of 5 stars Clear, Thoughtful Blueprint to an Ellusive Investment Arena, January 29, 2000

By	S. Schneider (USA) - See all my reviews (REAL NAME)

I'm surprised this book does not receive more attention as it is apparently the first book in a long while to give a careful treatment to the alluring and ellusive business of risk arbitrage. The book's primary merit is its author's clarity --beginning with a clear anecdote to illustrate why the business is called RISK arbitrage. Then, the author helpfully dissects risk arbitrage analysis into its most practical three analytic components: rate of return, risk and probability. He offers, with careful descriptions and examples, several mathematical models to aid in the assessment of these three areas, including a model which melds all three via a risk-adjusted rate of return calculation. The author makes application of these models to cash tenders (friendly and hostile), stock for stock transactions (with and without collars), complex deals involving cash, stocks warrants, bonds etc., and he devotes an entire chapter to hostile takeovers. He discusses portfolio management at length, with handy illustrations of how might one implement the use of spreadsheets, and also discusses hedging strategies fairly carefully. It is a great introduction to an investment arena long in need of a reliable navigator.

The book would get 5 stars if not for a teaser the author doesn't address quite as thoroughly as the rest of his text dictates: he discusses hostile takeovers at length with special emphasis on several anecdotes, but he describes events as they unfold with third-party detachment...whereas I imagine most readers really want to know how each new turn might affect his analysis and computations. But this criticism is a small quibble, and the author deserves tremendous credit for clearly describing a great deal in a short amount of space.

3 of 3 people found the following review helpful:

4.0 out of 5 stars Risk Arbitrage Analysis Framework, August 8, 2005

By	Brian Lomax (Short Hills, NJ) - See all my reviews (REAL NAME)

This book outlines a solid framework to assess risk arbitrage opportunities. The author describes types of transactions and the elements of return, risk, and probability to systematically analyze a deal. A number of useful formulas are included. However, a more thorough discussion on collar deals would be helpful.

3 of 3 people found the following review helpful:

3.0 out of 5 stars a good starting point, December 10, 2001

By	JRev "revland" (Philadelphia, PA) - See all my reviews

By the time you are done with this book, you will hunger for greater detail on the fascinating topic of merger arbitrage. For the most part, the book glosses over in mostly limited detail the key steps in understanding merger arbitrage. The author's considerable experience has allowed him to convey a somewhat complicated topic in non-complicating language. The author could have offered a more animated and detailed walk through of previous deals, to involved the reader in the drama that often unfolds during the lifetime of deals. Anyone with some degree of financial acumen, or who is interested in perhaps starting a hedge fund, will find it an incomplete discussion, but a very worthy read along the way toward greater mastery of this subject.