Convertible Arb Thoughts

Hey all -

Have a buddy's son that's about to break into Convertible Arb as an analyst at a large fund (the PM runs $1bn+)  - the kid has 4-7 years buy side exp, B school, traditional event-driven type. I have one or two guys that I know that work in the space, but they're not really close connections. 

Can anyone provide some info about work, a day in the life of, hours, work-life, comp, thoughts on the strategy in general, etc? Would be very helpful. Thanks. 

Comments (9)

Most Helpful
Jan 23, 2022 - 12:53pm
astfin-juki, what's your opinion? Comment below:

There used to be a guy working in convert Arb at my previous HF.

Lifestyle wise it seemed to be very good, not much trading after market hours. Liquidity is definitely a concern as some spreads don't trade that much as much as when you're trying to mark up your appropriate PnL. The strategy is very very niche. Haven't seen that many players and concentration risk is also a concern as sometimes there's just a few big guys in the same spreads and they can blow up at the same time. From what I heard, the performance can be very market dependent i.e. he had 1-2 years of low/negative PnL and then when he joined he absolutely killed it for 1-2 years.

  • Analyst 1 in S&T - Equities
Mar 5, 2022 - 11:25am

Why would most convert guys also trade SPACs?

  • Analyst 1 in S&T - Equities
Mar 5, 2022 - 5:03pm

Are these traders looking for similar characteristics? All SPACs are trading at like $5-6 there's not much to be made from the short and the warrants on these are still pretty expensive. Just curious about the rationale

  • Partner in HF - Event
Jan 23, 2022 - 5:15pm

Thanks for the comments, very helpful. Any specific color about comp, etc? Also - exit opportunities? Feel like because this is a niche investment strategy (not withstanding the fact that the kid would have prior event-driven experience), exits might be a bit insular?

Jan 24, 2022 - 4:26am
astfin-juki, what's your opinion? Comment below:

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