Facing its first losing streak and the uncomfortable attention of being associated with the Goldman Sachs fraud case, Paulson & Co. is planning a regulated version of its flagship hedge fund for retail investors.
The New York-based firm plans to launch the UCITS III-compliant vehicle this year. While it will be domiciled in Europe and targeted at European retail investors, the new fund will be open to all investors.
Paulson is the latest hedge fund to jump on the UCITS bandwagon. Dozens of hedge funds—primarily those based in Europe—have launched UCITS-compliant funds in recent months to avoid being shut out of their home markets by proposed European Union alternative investments regulations. UCITS-compliant funds will be exempt from those rules, which remain under consideration by European lawmakers and national governments.
Paulson will launch the fund on Deutsche Bank’s UCITS platform.
UCITS-compliant hedge funds have attracted more than $100 billion. Paulson could use some of those inflows, as his firm has been hit with some uncharacteristic outflows as its flagship Advantage funds suffered a rough first half. Paulson, which manages $31 billion, plans to close the Advantage funds to new investments this summer.