Tag Archives: DHR



Analysis of Split-off Trading Strategies

Split-Offs proved to be very lucrative in generating low risk arbitrage returns.  Just last week yet another split-off (ECL/APY) closed successfully with $2,100 ‘riskless’ return for hedged trades (c. +11%), while at at the same time unhedged positions delivered $10,000 (c. +50%-70%) in a month. The difference in pay-offs is clearly very material; however, higher returns seemingly come with higher risks (exposure to share price fluctuations).

 

Danaher (DHR) – Split off Transaction – $635 upside

Danaher has updated the split off offer by increasing the upper limit and the situation became profitable one more time.

Current Price – DHR $85.44, NTCT $38.42

Offer Price – $107.53 stock of NTCT for $100 stock of DHR (subject to upper limit)

Upside – 7.5% or $636 for Odd Lot holders

Expiration date – July 9, 2015