More corporate distress and consolidation should boost event-driven strategies

More corporate distress and consolidation as debt matures and needs refinancing in the US and Europe in 2014-15 spells good news for hedge fund managers using event-driven strategies.

Event driven hedge fund managers are expecting widespread corporate distress and consolidation to result from a deluge of debt maturing and the need for refinancing in the US and Europe in 2014-15. They hope this will be the kind of environment from which they can profit.

Because of this many allocators say distressed securities and merger arbitrage strategies, the two primary prongs of event driven, are their favourites.

Event driven funds seek profits from potential mispricings in various