This would be a two part series, where we first cover on the kind of investments we are constantly searching for, followed by a case study on our investment in Petrobras that we have recently exited out position from.

What are Asymmetrical Investments?

An asymmetric payoff (also called an asymmetric return) is an investment strategy where the upside potential is greater than the downside risk

— Wikipedia

In the nutshell, they are investments where we are paying 30 cents on the dollar, where the amount we stand to gain is far greater than the amount we will lose. An example would be when Klarman made an investment in bonds of a company that was affiliated with AIG during the Global Financial Crisis. The company’s bonds were trading for 20-30 cents on the dollar. While these bonds were trading at a discount of 70-80%, they were actually scheduled to pay investors back ...