Wednesday, 17 April 2013

John Paulson's Gold Trade Gone Awry



John Paulson made the “greatest trade ever” against the subprime mess, netting $15 billion of profits for his firm and sealing his spot as top hedge fund manager. Impeccable timing is everything. Any hedge fund managers may have the best investment idea, but it may not be able to pull off the trades as markets can remain irrational a lot longer than you and I can remain solvent.

His subsequent trade idea on long gold since 2009 has not paid off, just like his initial short on the housing market through CDSs. The debacle in gold has lost Paulson $1 billion in just two days. Yet, he is still sticking with his guns, on his conviction that the only asset that would hold value is gold against government’s continuing printing of money.

Read more here: Articles by Hedgie

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