Morgan Stanley Drops Paulson Funds, Encourages Redemptions

Dec 20 2012 | 9:49am ET

Morgan Stanley is dropping two Paulson & Co. hedge funds from its hedge fund platform.

Paulson's Advantage and Advantage Plus fund—which lost 36% and 51%, respectively, last year, and which are on their way to another double-digit loss this year—count about $100 million in Morgan Stanley client money among their roughly $5.7 billion in total assets. The bank cited the aforementioned poor performance for its decision, CNBC reports.

Morgan Stanley Wealth Management, which put the funds on watch in May, told its financial advisers on Tuesday that it had changed the funds' status again, this time to redeem. The advisers were told to suggest their clients pull their money from the funds.

Despite Morgan Stanley's decision to place the funds on watch and their continued poor performance, the redeem move was not expected, according to CNBC. Advantage is down more than 17% this year, and Advantage Plus more than 20%.

Morgan Stanley's move follows a similar decision by Citigroup in August. It does not affect other Paulson funds available on the Morgan Stanley platform.


In Depth

Exotic Assets: Investing In Rare Violins

Jan 17 2017 | 4:43pm ET

By definition, alternative investments include exotic assets far beyond your typical...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

The Trump Administration: What It Could Mean for Carried Interest

Jan 19 2017 | 5:25pm ET

The arrival of the Trump administration brings the potential for a repeal of the...

 

From the current issue of

Often seen as a passion project, or part of a philanthropic venture, rare and fine stringed instruments offer an exciting option to diversify one’s investment portfolio while providing an opportunity for an exceptional long-term investment.