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Paulson Funds Update 1H 2012

John Paulson, the billionaire hedge-fund manage who made himself infamous by profiting from betting against the US subprime mortgage market, his funds did badly in 2011.  Apparently, as of now, most the funds are in the red for first half of the year.   Investors can choose between gold- and dollar-denominated versions of most of Paulson’s funds.

Here is an update:

  1. Paulson Advantage Plus Fund – seeks profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns is down 16% this year.  The gold-share class of the fund declined 14% this year.The fund lose 51% in 2011 due to an ill-timed bet on a U.S. economic recovery.
  2. Paulson Advantage Fund – employs a similar strategy as the Advantage Plus Fund, fell 12% this year.  Its gold shares slumped 8% in the first half of the year.
  3. Paulson Gold Fund – which buy derivatives and other gold-related investments lost 23% this year.
  4. Paulson Recovery Fund, which invests in assets Paulson believes will benefit from a long-term economic rebound such as financial services, insurance, hotels and real estate companies gained 3.5% in the first half of 2012.  The gold shares advanced 3.6% this year.
  5. Paulson Partners Enhanced fund, which invests in the shares of companies that are involved in mergers, climbed 4.1% this year. The gold share class gained 4.4% in 2012.
  6. Paulson Credit Opportunities Fund advanced 2.2% in the first half of the year.  Its gold shares climbed 2.2% in 2012. The fund jumped 590% in 2007, largely because of Paulson’s bets against the U.S. subprime mortgage market.

The average hedge fund gained 1.7% in the first half of the year, while the S&P 500 gained more than 4%.

Reference:

  1. Bloomberg, Kelly Bit, 20120710, “Paulson Funds Fell in June As Rally Undercut Euro Wager”