Credit Suisse Launches Merger ETN (CSMA)

Credit Suisse rolled out the latest addition to its ETN lineup on Monday, launching the Credit Suisse Merger Arbitrage Liquid Index (CSMA). The exchange-traded note will be linked to an index designed to employ a merger arbitrage strategy by using a quantitative methodology to track a dynamic basket of securities held as long or short positions to reflect publicly announced merger transactions. CSMA will essentially seek to buy stocks that have been announced as takeover targets but for which the transaction has not yet closed. Because there is usually some degree of uncertainty as to whether an announced transaction will ultimately be consummated–regulatory and financing hurdles, as well as shareholder approval, are among the potential obstacles to closing a deal–takeover targets will often trade at a discount to the announced target price. By investing in stocks of publicly-traded takeover targets, investors can profit if the deal is ultimately [...] Click here to read the original article on ETFdb.com. Related Stories: Credit Suisse Launches Hedge Fund ETN (CSLS) Credit Suisse Set To Launch Cushing 30 MLP Index ETN (MLPN) Merger Arbitrage ETF Debuts