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Paulson stocks up on banks, drugs and gold
2009-08-13
NEW YORK (Reuters) - Hedge fund manager John Paulson, who made a fortune betting against financial companies after foreseeing the credit crisis, stocked up on shares of Bank of America Corp (BAC.N) during the second quarter. A regulatory filing on Wednesday also showed the widely watched investor had stocked up on other banks, gold miners and drug makers. His namesake Paulson & Co, which has vaulted to the top ranks of hedge fund managers after two standout years, bought 168 million Bank of America shares during the quarter to become the North Carolina-based bank's fourth-largest stockholder. The stake, worth $2.22 billion on June 30, was his biggest purchase during the quarter and represented his second-largest position. Paulson's investment moves are monitored by investors after he predicted the implosion of mortgage markets in 2007 and the collapse of banks and other financial companies in 2008. By betting subprime mortgages and then financial stocks would crumble, his Credit Opportunities Fund soared sixfold in 2007. The fund rose 37 percent last year, when the average hedge fund lost 19 percent. Earlier this year, Paulson appeared to adopt an even more bearish view of the markets and the economy by making aggressive purchases of gold mining companies. While Paulson did not increase his stake in the SPDR Gold Trust, which buys gold bullion, it remained his largest holding as of June 30. Paulson did increase his stakes in gold miners AngloGold Ashanti (ANGJ.J) to become the Johannesburg company's largest stockholder with a 12 percent stake. He also boosted his position in Gold Fields Ltd (GFIJ.J). On the other hand, Paulson trimmed his holdings in Market Vectors Gold Miners ETF, which tracks the Amex Gold Miners Index, to end June with a 5 percent stake. Yet Paulson's latest filing suggests he expects banks and other financial companies to rebound. Paulson on Wednesday reported new holdings in a number of national and regional banks, including 35 million shares of Regions Financial Corp (RF.N). That made him the Southeast bank's No. 2 shareholder. His firm bought 2 million shares of Goldman Sachs Group Inc (GS.N), 1.5 million State Street Corp (STT.N) shares and 5 million Fifth Third Bancorp (FITB.O) shares. Paulson joined a group of investors earlier this year in acquiring failed lender IndyMac Bancorp. Beyond banks and gold, Paulson's firm also sharply increased its stake in drug company Schering Plough Corp (SGP.N) to 55.1 million shares on June 30, up six-fold from 9 million at the end of March. Paulson held 48.4 million Wyeth (WYE.N) shares on June 30, up from 30.4 million shares. The quarterly ownership report also showed Paulson owned 20 million Liberty Media Corp (LINTA.O) shares, up from 2.4 million, and amassed new positions in Kimco Realty Corp (KIM.N), PepsiAmericas Inc (PAS.N), Pepsi Bottling Group Inc (PBG.N) and Sun Microsystems Inc (JAVA.O) since March 31. (Editing by Steve Orlofsky)
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