Subject category:
Finance, Accounting and Control
Published by:
Harvard Business Publishing
Version: 29 June 1995
Length: 10 pages
Data source: Published sources
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Abstract
An investment manager notices a large apparent discrepancy in the prices of two nearly-identical bonds issued in conjunction with a major leveraged buyout. The manager must figure out whether the instruments are mispriced relative to one another, and if so, how to capture arbitrage profits from the temporary anomaly. The case introduces students to a wide variety of instruments ranging from very simple treasury strips to P- I-K debentures. Encourages students to devise "arbitrage" positions and understand the degree to which these positions are riskless.
Location:
Other setting(s):
1991
Subject category:
Finance, Accounting and Control
Published by:
Harvard Business Publishing
Length: 10 pages
About
Abstract
An investment manager notices a large apparent discrepancy in the prices of two nearly-identical bonds issued in conjunction with a major leveraged buyout. The manager must figure out whether the instruments are mispriced relative to one another, and if so, how to capture arbitrage profits from the temporary anomaly. The case introduces students to a wide variety of instruments ranging from very simple treasury strips to P- I-K debentures. Encourages students to devise "arbitrage" positions and understand the degree to which these positions are riskless.
Settings
Location:
Other setting(s):
1991
Related
Subject category:
Finance, Accounting and Control
Published by:
Harvard Business Publishing
Length: 10 pages