Rhode Island Employees’ Retirement System
We are pleased to see the attractive opportunity set persist. We've been able to successfully capitalize
on a variety of investment opportunities across our diverse strategies, as evidenced by our strong Fund
returns. We believe the following represent currently attractive investment opportunities.
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Opportunity set
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Idiosyncratic credit: given increased volatility and dispersion across issuers and industries, we believe there are
opportunities to add significant alpha through superior security selection.
Capital structure arbitrage: finding opportunities as a result of dislocations primarily between debt and equity. As
issuers seek to optimize their balance sheets, we anticipate more opportunities to devise mutually beneficial,
privately-negotiated debt retirement transactions directly with issuers, as we have done following each previous
crisis.
Convertible relative value (CRV): valuations remain at relatively cheap levels and have lagged the significant
market recoveries in both equities and high yield credit.
Expecting robust new issue trends to continue, and, more importantly, to remain attractively valued in our
view.
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Leveraging our long-standing relationships with convertible underwriters to be actively involved in pricing
new deals and optimizing new issue profits.
Equity stubs: anticipating catalysts in our Softbank stub to drive value realization.
Distressed/Bankruptcy: expect opportunities to emerge as defaults continue to increase, particularly in energy,
leisure, and retail.
SPACs: continue to manage a relative value portfolio that seeks to capitalize on strong new issue and deal
announcement trends.
ARISTEIA CAPITAL®
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