Course Detail (Course Description By Faculty)

This 50-unit course focuses on arbitrage in corporate securities. It will focus on real-world examples in the context of academic theory and empirical research. The class sessions will include HBS case studies and lectures with required class participation. In addition, the required readings include several academic articles. The course will explore various corporate arbitrage strategies, including merger arbitrage, convertible arbitrage, closed-end fund arbitrage, dual-listed and dual-class arbitrage, and SPAC arbitrage. Given the limited number of classes available for a 50-unit course, we will approach these topics at a high level.

We will not have enough time to delve deeply into the more technical aspects of the literature. It is essential to understand the basic concepts to prepare you for studying the more technical material independently. My goal is for you to learn key ideas that will benefit you throughout your career, regardless of whether you choose to become an arbitrageur. My aim is not to train you as an arbitrageur; that requires years of experience on an arbitrage trading desk. Likewise, it is not intended to teach you the art of arbitrage investing. Rather, the objective of the course is to broaden your understanding of asset pricing and corporate finance, as arbitrage plays an integral role in maintaining market efficiency and in facilitating corporate transactions and liquidity demands of other investors.

Note: Other than the slight title change, 35144 is the same course as 35124 ("Arbitrage Investing") taught Spring 2025.

Business 35000 and 35200, or higher level, are strictly required. Without these prerequisites, you are a severe disadvantage relative to other students. Given the course is only 50 units, there is insufficient time to fill in the learning gaps by not having the prerequisites. Waiving these requirements will reduce the class quality for all other students. A prior background in finance is helpful in mastering the course due to the large amount of new material covered.  Cannot enroll if BUSN 35124 taken previously.