The Driehaus liquid alternatives team manages the Driehaus Event Driven strategy. The Event Driven strategy employs an array of trade strategies that seek to deliver superior risk adjusted returns, while exhibiting low correlation and less volatility relative to major asset classes/event driven indices. The strategy is led by portfolio managers Michael Caldwell, Thomas McCauley and Yoav Sharon.
Our institutional sales team will be pleased to address questions and requests related to separately managed account vehicles that employ our investment strategies.Ask Us!
The strategy seeks to provide superior risk adjusted returns with low correlations to major asset classes and lower volatility than the S&P 500 Index.
We believe attractive event-driven investments exist in the global equity and credit markets due to the highly idiosyncratic nature of event-driven situations. Traditional market participants are often unwilling or unable to navigate the capital structure, legal, and regulatory complexity of event driven situations and/or may have discomfort with binary outcomes. The strategy seeks to exploit these market inefficiencies by applying a highly specialized event driven investing framework which enables us to identify the most attractive risk adjusted return opportunity for a given situation.
This quarter we are inverting the case study theme by discussing examples of two prospective merger arbitrage investments wherein we applied our investing framework and decided NOT to invest initially, but ultimately invested once the risk-adjusted return opportunity became more compelling. These inverted cases exemplify how our investment process prioritizes preservation of capital first and foremost and illustrate how the broad scope and opportunistic nature of our approach to event driven investing provides more tools with which to generate alpha, as compared to funds limited to a single event type or asset class.
We are often asked “What type of event driven fund are you?” In this quarter’s letter, we illustrate our differentiated investment philosophy and process in action through the case study of our investment in Golden Entertainment, Inc (“GDEN”). Read more in our latest Event Driven Commentary.