10 Strategies Hedge Funds Use to Make Huge Returns

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8. Distressed Debt or Distressed Securities

Distressed Debt is an investment strategy, that involves purchasing bonds or stocks from the companies that are either already in default, bankruptcy or in distress. It may become very risky to follow this strategy as many of the companies do not recover the situation so easily. On the other hand, it may earn very attractive huge returns as the stocks are bought at such discounted rates. Sometimes the the hedge funds may in fact run the company.

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