Convertible Arbitrage Hedge Fund Definition

Below please find a definition of “Convertible Arbitrage Hedge Fund”

Financial Analysis Training & Glossary TermsConvertible Arbitrage Hedge Fund: A conservative, market-neutral approach that aims to profit from pricing differences or inefficiencies between the values of convertible bonds and common stock issued by the same company. Managers of such funds generally purchase undervalued convertible bonds and short-sell the same issuers’ stock. The approach typically involves a medium-term holding period and results in low volatility.

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