This year has been a very good one indeed for Paulson & Co.—with one notable exception.
The New York-based firm has posted double-digit gains in all of its main hedge funds through September. Its gold fund has been a different story.
Paulson's PFR Gold Fund—the former Paulson Gold Fund—fell a further 16% in September and is now down 62% on the year. The $350 million fund is Paulson's smallest, and is made up primarily of firm founder John Paulson's own capital.
Despite the huge losses and persistent downward trajectory for the precious metal, Paulson remains bullish on gold.
"While actual inflation and inflation expectations remain subdued, we continue to believe we are at risk of high inflation in the future," the firm wrote. "We also believe we are in a pause phase, which is likely to persist until we see the leading indicators of inflation pick up."
Paulson began reporting the Gold Fund's performance separately from its other funds this summer, in an effort to focus attention on the strong performance of its main funds.