Trends Watch: Opportunistic and Event-Driven Investing

EisnerAmper’s Trends Watch is a weekly entry to our Alternative Investments Intelligence blog, featuring the views and insights of executives from alternative investment firms. If you’re interested in being featured, please contact Elana Margulies-Snyderman.   

This week, Elana talks with Ilya Zaides, Founder & CIO, 14B Capital Management.  

What is your outlook for opportunistic and event-driven investing?  

It’s called opportunistic investing for a reason.  I’ve been in this business for over 25 years, and I’ve never seen a market that doesn’t present opportunities.  To me, the clearest opportunities today are in financials and financial technology.  Partly this is due to a combination of macro-factors including changes in interest rates, economic expectations and capital conditions.  We focus on specific businesses but currently these areas are interesting due to the significant changes in business prospects at the company level due to these macro factors.   

We see event-driven situations as catalysts or potential catalysts for these businesses.  There are always managers, board members, shareholders, regulators and even competitors that want to change a business in one way or another.  And there will apparently always be an army of lawyers and bankers that are willing to help.         

Where do you see the greatest opportunities and why? 

There will likely be large scale productivity benefits from AI. Technology companies and financials are both likely to benefit significantly from computer-aided productivity enhancements.  There are a number of historical precedents for this. My guess is that history will rhyme.      

What are the greatest challenges you face and why?  

Regulatory changes, particularly as they apply to: 

1. Electronic payments and money flows (e.g., central bank digital currencies and national payment schemes); and 
2. hyperscale cloud providers like Microsoft, Google, Amazon and Meta.  

They are and will likely increasingly impact the playing field for many of the investments we have and companies we follow.  

What keeps you up at night?  

There are always times when your thesis in an investment begins to break down.  That’s typically company-specific.   

Broad macro issues like geopolitics, climate change and war all have investment implications that need to be considered but are not typically something to lose sleep over since the effects are generally either already well known or largely unpredictable.  We typically try to manage these types of risks rather than attempt to predict them.   

The views and opinions expressed above are of the interviewee only, and do not/are not intended to reflect the views of EisnerAmper.