Michael Rosen - Hedged for Success: convertible bonds explained

In this episode of Inside the Rope, David speaks with Michael Rosen, co-founder and CEO of Context Capital. They discuss his journey in finance and the founding of the firm. Michael covers his career managing a mutual fund group and the decision to start Context Capital after recognising the limits of traditional mutual funds, particularly the lack of hedging options available.

Michael covers Context Capital’s investment strategy, which focuses on convertible bonds, a hybrid asset that sits between debt and equity. Michael explains how the firm manages $2.7 billion while producing an average return of over 12% per year since inception, reducing risk through strategies like shorting equities.

Michael also shares lessons from his restaurant ventures, drawing comparisons between running a restaurant and an investment firm. He highlights the importance of preparation and teamwork in both fields.

Finally, Michael highlights his views on future opportunities in convertible markets and how investors view the strategy as offering equity-like returns with lower risk.