After Brief October Respite, Mauling Of Paulson & Co. Investors Resumes
Following a widely publicized bounce in the Paulson & Co. performance in October, a time in which even the since retired beta chaser extraordinaire Bill Miller probably made money, and following the mocked by Zero Hedge 13F announcement that John Paulson had sold gold exposure to buy even more Bank of America stock, we now learn that the fund's LPs have once again resumed crash positions, with the performance of his fund dropping back to 2011 lows at -46% through November. Bloomberg brings us details: "Paulson’s Advantage Plus Fund, which seeks to profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns, declined 3.6 percent last month. The fund’s gold share class dropped 2.7 percent in November and 29 percent this year. Paulson & Co., which is based in New York and manages $28 billion, has lost money this year on investments including Citigroup Inc., Bank of America Corp. and Sino-Forest Corp., the Chinese forestry company accused by short-seller Carson Block of overstating timberland holdings. Paulson’s biggest funds, Advantage Plus and Advantage ... have $11 billion in combined assets. The dollar-denominated Advantage Fund fell 3.3 percent in November and 32 percent this year. Its gold share class slumped 1.5 percent last month and 13 percent in 2011. Paulson investors can choose between dollar- and gold-denominated versions for most of the firm’s funds." Perhaps it would be easier for Bloomberg to track what the former Bear trader has actually made money on in 2011. We are confident they would be surprised by the list.
Yet there is one thing Paulson has still made some money on:
The Gold Fund, which can buy derivatives and other gold- related investments, rose 1.3 percent in November and 11 percent this year.
Yup - the same thing we have said since January 1, 2011 (and actually March 2009) is the only worthwhile investment. And we do it for free.
As for everything else, it has been a disaster:
The Recovery Fund, which invests in assets Paulson believes will benefit from a long-term economic upturn, fell 4 percent in November and 28 percent this year. The gold share class declined 2.2 percent last month and 12 percent in the year’s first 11 months. Paulson has been betting on a U.S. economic recovery by the end of 2012.
The Paulson Partners Enhanced Fund, which invests in the shares of merging companies, decreased 0.6 percent last month and 18 percent this year. Its gold share class advanced 0.7 percent in November and declined 0.9 percent in 2011.
Paulson’s Credit Opportunities Fund slumped 3.6 percent last month and 18 percent this year. Its gold shares dropped 1.6 percent in November and gained 0.3 percent in 2011.
All this just goes to show: when one is at the right time and the right place, and has hired the right smart people to make investment decisions, it doesn't matter just how horrible of a stock picker one actually is.
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