Hedge funds aiming to profit from the uncertainty over whether corporate takeovers that have been agreed will ultimately be completed say the US stock market now offers more compelling targets than when the eruption of the coronavirus pandemic threatened to torpedo every deal.

So-called merger arbitrage funds typically place bets in the period between a deal being struck and when it is due to complete, a high-stakes strategy that relies for its success on correctly predicting whether a transaction will happen against an often volatile backdrop.

Published by Sujeet Indap and Antoine Gara in Financial Times.