Financial Times- Hedge funds aiming to profit from activism and corporate events have been hit hard this month as a raft of deals fell through and markets plummeted.
The so-called event-driven sector, which includes many of the best-known activist hedge funds, is bearing the brunt of a downturn in hedge fund performance this month, the worst for the industry since the credit squeeze hit home in August.
Event-driven funds buy cheap stocks where they believe a catalyst such as a bid or restructuring will boost the price. They often agitate for change.
According to investors several funds turned in double-digit drops in the first three weeks of this month, hurt by losses as private equity groups walked away from agreed takeovers and by the renewed impact of concern over credit.
