How to Profit from Public Company Going to Zero

Let’s say that I know with 100% certainty that a publicly-listed company will announce its bankruptcy. The company does not have options. Aside from shorting the stock outright, what are some other ways that investors can profit?

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Buying bonds/loans at distressed prices assuming attractive creation multiple for the post emergence company.

Short bonds/buy CDS if think bonds will fall.

Buying trade claims at a discount assuming you think there will be a full recovery.

Buying puts on the equity.

Of course most of these things 1) aren't for retail investors, and 2) more importantly, its often extremely difficult to source these securities - a bond might be quoted at an attractive distressed price but more times than not there is minimal if any offered for sale - or the price of the carry of a short will be prohibitively high eroding potential returns.

 

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