He's a big investor in banks, and as such, John Paulson's rough year is getting rougher.
Returns for the hedge fund billionaire's Advantage Plus fund were down 31% so far this year, through the end of Friday's trading, according to someone briefed on the figures. The fund, which uses leverage, was down 22% through the end of July.
Meanwhile, Paulson's Advantage fund is down about 21.5% so far in 2011 through Friday, the person said. That fund was down 15% through July.
Paulson, whose Paulson & Co. manages about $35 billion, had been a big holder of stocks like Citigroup Inc. and Bank of America Corp. this year; those shares have tumbled lately.
There appears to be a sliver of good news for Paulson. His gold fund is up about 6% for the year, according to an investor's calculations.
The bulk of Paulson's own money is in gold, and in gold-denominated share classes offered by his company, so he is making out much better than many of his investors.
Another piece of good news for Paulson: On July 31, the company received withdrawal notices amounting to about $430 million from the two Advantage funds, or 2.8% of their $15.5 billion assets, according to a letter sent to Paulson investors on Friday. That is less than Paulson usually receives in withdrawal requests for quarterly withdrawals, the letter said.
One big reason the funds didn't see many redemptions: More than 36% of the cash in the funds is from the company's employees, according to someone close to the matter. The company's letter said redemptions from Paulson's other hedge funds were "de minimis."
