Make Money by Spinoffs

“Spinoffs can take many forms but the end result is usually the same: A corporation takes a subsidiary, division, or part of its business and separates it from the parent company by creating a new, independent, free-standing company. In most cases, shares of the new “spinoff” company are distributed or sold to the parent company’s existing shareholders. There are plenty of reasons why a company might choose to unload or otherwise separate itself from the fortunes of the business to be spun off. There is really only one reason to pay attention when they do: you can make a pile of money investing in spinoffs. ”

Excerpt From: Joel Greenblatt. “You Can Be a Stock Market Genius.”