6 Best Performing Relative Value Arbitrage Funds

 | Feb 21, 2022 12:53AM ET

Relative value arbitrage is an investment strategy that involves the use of multiple investment strategies to earn returns. An investor using this strategy simultaneously buys and sells different securities to benefit from the "relative value" of the two securities. Though this strategy sounds simple, it isn’t easy to implement.

Investing in fixed income markets.

WMNAX has more than $157 million in total assets, and has returned over 1% in the last six months and over 6% in the last three years. The top five holdings of the fund are: Ford Motor Company (NYSE:F) 0%, Tilray (NASDAQ:TLRY) 5%, SFL Corporation (NYSE:SFL) 4.875%, Apollo Commercial Real Estate Finance (NYSE:ARI) 4.75%, and Southwest Airlines (NYSE:LUV) 1.25%.

5. Absolute Convertible Arbitrage Fund ( 3%)

Absolute Convertible Arbitrage Fund (MUTF:ARBIX) mainly invests in a diversified ETFs (exchange-traded funds), options and currency forwards to hedge its risk.

PSCIX has more than $159 million in total assets, and has returned over 1% in the last six months and almost 7% in the last three years. The top four holdings of the fund are: American Beacon US Govt MMkt Select, ProShares Short 20+ Year Treasury (NYSE:TBF), MFA Financial (NYSE:MFA) 6.25%, and Pennymac Corp. 5.5%.

3. Calamos Market Neutral Income (5%)

Calamos Market Neutral Income Fund (MUTF:CVSIX) invests in convertible securities of U.S. companies, equities, as well as uses short selling and total return swaps to earn a return and convertible fixed income and preferred securities. It generally invests in U.S. companies, but may invest in non-U.S. companies as well. LEOIX has more than $148 million in total assets, and has returned almost 3% in the last six months and over 8% in the last three years. The top four holdings of the fund are: United States Treasury Bills 0%, Innoviva (NASDAQ:INVA) 2.125%, Hope Bancorp (NASDAQ:HOPE) 2%, and Atlas Air Worldwide Holdings (NASDAQ:AAWW) 2.25%.

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