Ask Matt: Are spin-offs easy money?

April 8, 2015 10:34 AM

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Ask Matt: Are spin-offs easy money?

A: Activist investors love spin-offs. These corporate moves are designed to unlock value of a unit buried inside a bigger company – and often times they do.

The Guggenheim Spin-Off exchange traded fund returned 6.8% to investors during the first quarter, beating the nearly 1% total return of the Standard & Poor’s 500, says Joe Cornell of Spin-Off Research. Much of that strong performance is due to the 40% gain of Kraft following the buyout news. Spin-of...

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