The subtleties and complexities underpinning the special situations and distressed landscape have contributed to its reputation as a fairly convoluted space for prospective investors. Deciphering the special situations universe requires an understanding of the range of strategies available to fund managers as well as their risk-return profile, and an alignment on relevant terminology. The diverse strategies that fall under the special situations and distressed umbrella can be implemented across different parts of the capital structure with different aims, complicating direct comparisons and requiring thorough due diligence. A special situation is an atypical event that compels investors to buy equity, debt, or an asset in the belief that its value will increase. Special situations investments are defined by an element of distress, dislocation or dysfunction that can contribute to a mispricing of the underlying assets. Broadly speaking, there are four principal strategies employed by managers in the special situations space, each with distinct characteristics: Distressed debt, Distressed-for-control, Event-driven, and Turnaround.