Quote from thetraderprofit:
In terms of a percentage of capital, I don't really look at it this way. I try to estimate a worst case loss in which my risk is limited to $150,000. I try to stick to low risk deals, and leverage them up. For example, BAC/FBF is trading around 10 cts. I have it on in size as all approvals are in. I'm willing to risk a lot to make a little on a deal with little risk.
Sounds pretty research intensive. Do you have to continually scan the news for takeover announcements, then act immediately, or do you prefer to wait until you can fully analyse the deal? What's the most leverage you can use on these deals?