This article aims at testing empirically the performance of event driven hedge funds. The fund manager primarily is targeting financial, micro and macro economic or political events, corporate events that will affect positively the net asset value, NAV, performance of the fund. Merger arbitrage involves buying the stock of the target companies after a merger announcement and shorting the acquiring company’s stock. Guirguis,(2005), examined the major building blocks that affect the performance of hedge funds: incentive fees, management fees, size, age, hurdle rate, high watermark provision and lockup period. According to my findings the results are mixed. Management fees and age affect significantly the performance of hedge funds. My findings suggest that there are other factors that could contribute to this deviation such as lock-up periods, hurdle rate and high water mark. Dummy variables applied on the probit binary regression equation suggest that these three factors constitute a significant explanation of the performance persistence. Guirguis, (2022), found that for the CAPM regression results, all alpha are positive and not statistically significant at 5% level. Based on Fama and French,(1993), three factor model regression results, seven out of nine categories display a significant alpha. Based on Carhart’s ,(1997), four - factor model, eight out of nine style categories display an alpha that is positive and statistically significant at the 5% significance level. Based on my regression results or Guirguis, (2005), six - factor model all style categories display an alpha that is positive and statistically significant at the 5% significance level. The sample is provided from Data Feeder dataset. It includes event driven hedge funds for the period 1990 to 2003
