Event-Driven Trading Strategies

Several investment management companies have specialized in exploiting news driven trading strategies. Event driven strategies are defined as “special situations” investing. The strategy is designed to extract profits by significant pending corporate or market news events. Such corporate news events are for example mergers, restructuring, litigation or bankruptcy, examples for market news are announcements of economic indicators (unemployment rate, PMIs, etc.) or interest rate changes.

Event driven funds invest in almost all liquid asset classes, i.e. equities, fixed income instruments and derivatives. The strategies can be differentiated in terms of their investment horizon. High-Frequency investors have typically an investment horizon of less than five minutes and aim to profit from fast information processing. Merger-arbitrage funds in contrast invest often over time periods spanning a horizon of several weeks up to several month, seeking to capture the spreads in the transaction bid and the trading price after a merger or acquisition announcement.

Hendrik Klein

Hendrik Klein is an expert in investment strategies like Relative Value, Systematic Event Driven, High Frequency Trading (HFT) and Global Macro Strategies, alternative investments and the Head Portfolio Manager since 2004 at Da Vinci Invest AG. As a frequent speaker on conferences and an interview partner in TV i.e. ZDF, CNBC and magazines he is known as a specialist in HFT. He started his career as a derivatives trader at MTH Midas Trading House from 1996 to 1997, which became the largest trader on the DTB at that time. He subsequently held trading and brokerage positions at Fimat International Banque S.A. (1997) and Landesbank Baden-Wuerttemberg (1998 to 2000), before becoming the Head of Trading and a director and partner of Frohne & Klein Wertpapierhandelshaus GmbH in 2000. He held this position until 2004, during which time he specialised in listed options trading on EUREX.