- risk arbitrage
- Traditionally, the simultaneous purchase of stock in a company being acquired and the sale of stock of the acquirer. Modern risk arbitrage focuses on capturing the spreads between the market value of an announced takeover target and the eventual price at which the acquirer will buy the target's shares. Bloomberg Financial Dictionary
* * *risk arbitrage risk arbitrage ➔ arbitrage
* * *risk arbitrage UK US noun [U] FINANCE, STOCK MARKET► the practice of buying and selling shares in two companies that are involved in a takeover in order to make a profit from the difference in their share prices: »
The strong rebound in US merger activity brought a renaissance in takeover-stock investing, known as risk arbitrage.
Financial and business terms. 2012.