Is this a turning point for the fund or is his bench still deep enough to keep pulling out those stellar returns? Enquiring minds should wanna know: It'll be interesting to see how the $37 billion Paulson & Co. performs going forward. Paulo Pellegrini, co-portfolio manager on Paulson's Credit Opportunity funds, and one of the key lieutenants of John Paulson's strategy to short sub-prime debt, is leaving to start his own firm. The split was supposedly amicable. Pellegrini, who had a derivatives background, joined the firm in 2004. According to the Wall Street Journal:
While Mr. Paulson is the visionary within the firm who drives its general direction, Mr. Pellegrini and a few others helped find the riskiest subprime-mortgage securities to bet against, and figured out the best way to capitalize on their expected falls in value.
Mr. Paulson's two credit funds rose about 15% in 2008 through the middle of December. Other Paulson funds rose between 7% and 38% in that period, thanks to wagers against financial firms and general cautiousness about the economy.....
But Mr. Paulson's original focus, the merger-arbitrage world, has proven trickier lately.
Paulson was, according to public filings, the largest holder of Rohm & Haas Co. as of Sept. 30; the company tumbled last week on worries about an acquisition. It also held 5.5 million shares of telecom-provider BCE Inc., which has fallen, too. It isn't clear whether Paulson still holds shares or how much of any positions were hedged. A spokesman declined to comment.
Pellegrini to Leave Paulson & Co. to Start Own Fund - Wall Street Journal
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