THIRD POINT INVESTORS USD

Investment Process

This close ended investment company is a feeder fund that invests in an underlying master fund - Third Point Offshore Fund Ltd, which gives access to the investment skills of the US based activist hedge fund manager Dan Loeb. The manager pursues a research-driven strategy based on fundamental value. The primary focus of the investment effort is to identify "event driven" situations in which a potential event should lead to a significant revaluation, up or down, in a company's securities. Positive potential events could include operational restructurings, recapitalisations, or change in management or sale of a company. Negative potential events could include a liquidity crisis, adverse litigation outcome, or the exposure of accounting or other irregularities. The funds managed by the Investment Manager have the capacity to assume large positions in particular companies, and to influence the affairs of those companies, thereby increasing the likelihood that the envisioned catalysing event will in fact occur. This investment process is applied to many different industries as well as geographic regions. Three strategies are typically applied to exploit such event driven opportunities: merger arbitrage, distressed securities and corporate restructuring - essentially investing in companies where the management feel a turnaround situation is likely. Note as the manager also looks to gain from negative events, shorting (gaining from falling shares) strategies are also applied. The fund can also use derivatives, specifically futures and options, therefore further increasing the risk. Management are also invested in the fund and they will consider buybacks of the company's shares, if the discount (lower share price than net asset value) should exceed 5%.