Friday, November 20, 2009

John Paulson's new gold fund + lessons

It's been a big week for the cottage industry of John Paulson-watching.

The Paulson & Co. fund manager is set to launch a dedicated gold and gold mining equity-focused fund at the start of next year, in which he'll invest $250 million of his own money.

You may recall that Paulson's earlier forays into gold ignited a new rush into gold by hedge funds and investors piggybacking on the trades of sophisticated hedge fund managers. JP's new fund signals his continued positive outlook for the precious metals sector over the intermediate to long-term.

That's not all that's happening in the world of John Paulson. Investors have pored over his firm's recent 13-F filing and letter to investors, while his comments on Bank of America (Paulson & Co.'s largest position in the financials sector) have fueled publicity over a divergence of opinion with bank analyst Meredith Whitney on the stock's outlook.

Plus, there are gathering opinions on Gregory Zuckerman's new book, "The Greatest Trade Ever", which details the fund's (now legendary) short subprime CDS bet, and its role in pushing Paulson & Co. into the investment world limelight.

If that's not enough, you can also catch Zuckerman's recent Wall St. Journal piece adapted from that book, or check out Eric Jackson's fine article, "What John Paulson could teach us". This is one I'm currently reading, and it contains some great insights on the team (including Paolo Pellegrini) that put together Paulson & Co.'s housing trade strategy. Do take a look.

Related articles and posts:

1. John Paulson: The man who made too much -

2. John Paulson in Bloomberg Markets - Finance Trends.