Chapter 104

Risk Management in Vulnerability Arbitrage

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While profitable, vulnerability arbitrage carries specific risks:

Reputation Risk: Being seen as "vulture" rather than helper. Manage through value focus and ethical practices.

Timing Risk: Denial lasting longer than expected. Mitigate through portfolio approaches and patient capital.

Solution Risk: Vulnerabilities manifesting differently than expected. Address through flexible, adaptable solutions.

Competitive Risk: Others recognizing same opportunities. Differentiate through relationships and specialized expertise.