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The popular hedge fund strategy of profiting off corporate slim-downs—often through the spin-off of entire company units—isn't as lucrative as it used to be.
Forty-six companies that announced a spin-off in the last year have seen their median stock prices drop 0.3 percent, The Wall Street Journal said, citing data from FactSet. Thirty days after such an announcement, the median stock had returned 1.2 percent, versus a 1.7 percent rise in the broader Index.
Recent losers for hedge funds, and noted by the Journal, were AbbVie's abandoned takeover of Shire and cuts announced by Hertz and eBay.
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