Paulson's Citi Bet Earns $1B, Drives '10 Turnaround

Jan 25 2011 | 2:56pm ET

Paulson & Co.'s flagship hedge fund was still down by double-digits in August. It ended the year up double-digits. How? With (more than) a little help from Citigroup.

John Paulson's hedge fund had been hard-hit by his potentially premature bet on the U.S. economic recovery in the early going of 2010. But his big investment in Citi turned a $1 billion profit for the firm in the second half of the year, Paulson's most profitable bet of the year.

Paulson's Advantage Plus Fund soared 13% in December to end the year up 17%. It's Recovery Fund was perhaps the biggest beneficiary of Citi's turnaround, rising 14% last month and 24% on the year.

"We believe the U.S. economy is recovering, and we anticipate continued growth," Paulson wrote to investors.

"In addition to maneuvering our investment strategy based on where we are in the economic cycle, a large part of our success has been based on anticipating market events before they are generally recognized," he gloated.


In Depth

Q&A: Rotation Capital's Rothfleisch On SPAC 2.0

Aug 11 2017 | 7:43pm ET

Corporate actions have long been a staple of event-driven investors, but activity...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Star Mountain: Private Lending in the Lower Middle-Market

Aug 14 2017 | 4:45pm ET

Private credit has become one of the most popular alternative asset classes in recent...

 

From the current issue of