Kevin Russell, CIO of UBS O’Connor, the hedge fund, wrote in his annual letter on Wednesday that the manager will increase its attention and allocations to merger arb in 2022.

The strategy, in which investors buy and sell the stocks of two companies involved in a merger, has been a core element of O’Connor’s approach since the hedge fund manager launched in 2000. In recent years, Russell wrote, the manager hasn’t viewed the strategy as a fundamental driver of returns, but now feels that it warrants increased investor attention.

Published by Jessica Hamlin in Institutional Investor.