AbbVie’s decision that Shire without the tax inversion break really isn’t worth the $54 billion hasn’t just gotten Paul Singer’s lawyers busy: It also put the probably final nail in what had been a very promising year for old John Paulson. The non-merger, coupled with a judge’s annoyingly legalistic insistence on not just letting hedge funds have everything they want with regard to Fannie Mae and Freddie Mac, cost Paulson’s Advantage Fund 14% last month, giving him quite the hill to climb if it’s not going to have a 2011/2-esque year and a desperate willingness to suggest anything.
The Paulson Advantage fund, which specialises in investing in companies involved in one-off events such as mergers or spin-offs, saw several of its large bets go awry in October. This took its total loss for the year to 25 per cent, according to the fund’s most recent figures.
Other things aren’t going so well, either.
The flagship Paulson Partners $10bn merger arbitrage fund fell 4.8 per cent during October, wiping out its gains to leave it flat for 2014. Paulson Credit Opportunities, which manages more than $5bn, fell 6.8 per cent last month, taking its loss to more than 3 per cent for the year to date.