Paulson's Fund Lost 4.3%, Hurt by Hopes on Economy
Hedge-fund manager John Paulson's Advantage Plus Fund declined 4.3% in August, as it continues to suffer for betting too soon on an economic recovery, a person familiar with the situation said Wednesday.</br></br>The August decline brings the fund's year-to-date loss to 11%, the person said.</br></br>Mr. Paulson was among the big hedge-fund managers to build a stake in banks last year, reversing course after winning big in betting against subprime mortgages during the financial meltdown. However, banks underperformed broad market indexes as investors were disillusioned about a pickup in economic growth.</br></br>Among Mr. Paulson's bank holdings are Citigroup Inc., Goldman Sachs Group Inc. and warrants of Bank of America Corp., according to a quarterly filing with the Securities and Exchange Commission last month.</br></br>Mr. Paulson's Gold Fund rose 9% in August, the person said.