Paulson Preps Hedge Funds To Invest In Banks

Jul 23 2008 | 11:47am ET

New York hedge fund Paulson & Co., which made a killing on falling mortgage bonds last year, plans to do the same when the market rebounds.

The $33 billion firm is setting up a hedge fund to make long-term investments in financial services firms burned by the credit crisis and market slump, Bloomberg News reports. The new fund, for which Paulson has not set a fundraising target, may debut in December.

The Amex Securities Broker/Dealer Index is down 35% in the past 12 months, while the largest banks and financial firms have taken some $467 billion in write-offs related to the credit crisis. The new Paulson hedge fund would provide capital to those firms, aiming to profit on their resurgence.

Firm founder John Paulson, who saw several of his funds post triple-digit returns last year, told a Monaco conference that his firm hired professionals to research securities firms to see what sort of opportunity there might be for long-term investments.

“We’re trying to see the right entrance point,” he said. “If you invest too early, you lose money.”


In Depth

FINalternatives Survey: We Asked Investment Pros...

Apr 2 2016 | 9:42pm ET

The data from our annual reader survey continues to roll in and provide interesting...

Lifestyle

Point72's Cohen Donates $275M To Veterans Mental Health Network

Apr 6 2016 | 8:31pm ET

Billionaire hedge fund manager Steve Cohen has formed a non-profit aimed at treating...

Guest Contributor

Agecroft: Why NYCERS Should Reconsider Exiting All Hedge Funds

Apr 18 2016 | 5:51pm ET

The recent decision by the New York City Employment Retirement System to exit its...