Just as John Paulson’s career was over, it seems he wouldn’t just die down. After his storied killing betting against subprime, the hedge fund hero is making a so-so returns in the investment industry. While he was earning billions of dollars before, today, he seems struggling back to get in form.
As the founder of Paulson and Company, he doesn’t even look average this year. He only has Advantage Fund as his biggest portfolio that has returned 15% versus 17% from his peers. Moreover, while he still continues to bet on gold an and what big banks are paying off, it wouldn’t likely to product record gains that made him like a rock star in Wall Street.
Tammer Kamel, managing partner of Toronto’s Iluka Consulting once said, that Paulson is quite capable of earning so much money. But he doesn’t have the crystal balls that would enable him to earn so much year after year.
Paulson has a very long history in hedge fund business. Since 1994, he never gained much attention for his returns. The most that it garnered was only about 16% a year, decent but not hardly noticeable gains in the hedge fund world.
Until the real estate bubble inflated, he made a massive bet against subprime mortgages wagering that their value would crater. True enough, two of his portfolios earned nearly 600% that year, a period where a typical hedge fund would only get 10%. He continued his run up to 2008 by shorting such big banks as Lloyds Banking Group, Royal Bank of Scotland and Barclays.
Today, he has even continue to score big profits. In November, he doubled his stake in Kraft Foods, which is making a hostile play for Cadbury. His wizardry doesn’t end their, he was in fact trolling around bankruptcy courts for opportunities and is trying to gain control of Idearc, a US telephone book publisher.
But wherever his fortune came, there is one thing that we are absolute about. Paulson is such a heck of an investor. You might be wondering where those financial information came – one thing we are sure, he is doing his own study and research for what he believes in.