Friday, 1 August 2014
Last updated 14 hours ago
Aug 5 2011 | 1:09pm ET
Paulson & Co.'s annus horribilis continued into July—and shows no signs of stopping.
The New York-based hedge fund dug itself an even deeper hole last month, with most of its hedge funds—with the notable exception of its gold-denominated share classes—taking another bath.
The firm's largest fund, Advantage Plus, lost 4.6% in July and is down a whopping 22% for the year. Its flagship Advantage fund fell 3.3% on the month and is down 15% on the year.
Investors in the gold versions of both funds are doing much better, if not well: Advantage Plus gold-share clients are down 10% on the year after adding 1.5% last month, while Advantage clients are down just 2.1% after that fund rose 5.2% in July.
Indeed, investors who heeded firm founder John Paulson's advocacy in favor of gold have little to complain about. The firm's gold-only fund is up 2.5% on the year after soaring 11% in July. And every one of the firm's gold share classes is vastly outperforming its dollar-denominated counterpart.
The firm's Credit Opportunities Fund is up just 3.8% this year for dollar investors (down 1.3% in July), but it's up 13% for gold investors after rising 4.3% last month. Similarly, the Enhanced Fund is up 2.9% this year after dropping 3% last month, but its gold shares are up 12% after a 2.8% jump last month.
And Paulson's Recovery Fund, battered by its investment in Chinese timber company Sino-Forest and by the anemic recovery of the U.S. economy, saw its dollar-denominated gains wiped out last month by a 4.9% drop. But its gold shares rose 1.6% to end July up 5.1% on the year.
Don't expect Paulson to throw in the towel, however: Paulson Advantage was down by double-digits as late as September of last year but finished 2010 up 11%. Still, it may be too much to ask for the recovery to begin this month: Two of Paulson's largest holdings, Alpha Natural Resources and Mylan Inc. have both taken a beating in August's early going.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…