John Paulson's Long-Term Holdings

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 |  Includes: AU, BSX, COF, GFI, GLD, JPM, KGC, SPY
by: Insider Monkey

John Paulson is the most successful hedge fund manager of the past four years. He made $4 billion by betting against subprime mortgage investments in 2007 and another $5 billion by betting on gold and the recovery of the economy in 2010. Paulson's Paulson & Co. manages separate client-focused portfolios, employing merger arbitrage, long/short, and event-driven strategies. Paulson uses fundamental analysis to make his investments.

The table below shows the performance of Paulson's long-term stocks in the last two years. Paulson's long term holdings gained 63% since March 2009, underperforming the SPY by 3.5 percentage points. (See Paulson's current top holdings here). WSJ reports that Paulson's Advantage Plus fund lost more than 13% this month through June 10, bringing its YTD losses to 19.65%. (Here are the details)

Stock

Value
(Millions)

Return
Since Mar 31,2009

SPDR GOLD TRUST (NYSEARCA:GLD)

4,405.6

66.1%

ANGLOGOLD ASHANTI (NYSE:AU)

1,968.2

15.6%

CAPITAL ONE FINL CORP (NYSE:COF)

935.3

304.0%

GOLD FIELDS LTD (NYSE:GFI)

454.8

28.9%

KINROSS GOLD CORP (NYSE:KGC)

299.3

-14.8%

JPMORGAN CHASE & CO (NYSE:JPM)

230.5

56.0%

BOSTON SCIENTIFIC CORP (NYSE:BSX)

107.9

-14.6%

Average Return

8,402

63.0%

(NYSEARCA:SPY)

N/A

66.5%

Click to enlarge

1. SPDR GOLD TRUST: GLD was Paulson's biggest investment at the end of March 2011. Paulson had $4.4 billion invested in GLD at the end of March. Paulson bought 31.5 million shares of GLD during the first quarter of 2009 with an average price of $79.8-$97.8. GLD recently traded at $149.94. Paulson made more than $1.6 billion with his GLD investment. GLD has gained 66.1% since the end of March 2009. Gold holdings in the SPDR Gold Trust increased 9.09 metric tons to 1,209.14 metric tons as of June 17, according to Bloomberg News.

2. ANGLOGOLD ASHANTI: Paulson had included AU in his portfolio during the first quarter of 2009. During the second quarter of 2009, he increased his holdings in AU with a price of $33.7-$42. AU recently traded at $42.1 and has a 0.5% dividend yield. AU has gained 15.6% since the end of March 2009. The stock has a market cap of $16.2 billion and P/E ratio of 94. Paulson had $1.97 billion invested in AU shares.

3. CAPITAL ONE FINL CORP: COF has been one of the profitable investments for Paulson. Paulson had $935 million invested in COF at the end of March. Paulson had included COF in his portfolio during the first quarter of 2009 as the stock price was hovering between $8 and $33. During the second quarter of 2009, he increased his holdings in COF. COF recently traded at $48.8 and has a 0.4% dividend yield. COF has gained 304% since the end of March 2009, outperforming the SPY by a large margin. The stock has a market cap of $22.2 billion and P/E ratio of 7.2. Paulson had $935 million invested in COF shares. Edward Lampert's ESL Investments, Bill Miller's Legg Mason Capital Management, Clint Carlson's Carlson Capitals and Lee Ainslie's Maverick Capital are other high profile COF investors.

4. GOLD FIELDS LTD: GFI recently traded at $14.23 and has a 1.4% dividend yield. GFI has gained 28.9% since the end of March 2009. The stock has a market cap of $10.3 billion and P/E ratio of 36.4. Paulson had $455 million invested in GFI shares.

5. KINROSS GOLD CORP: KGC recently traded at $15.06 and has a 0.7% dividend yield. KGC has lost 14.8% since the end of March 2009, underperforming the SPY by a large margin.. The stock has a market cap of $17.1 billion and P/E ratio of 16.9. Paulson had $299 million invested in KGC shares. Kinross Gold Corporation announced on 14 june that it has subscribed for 625,000 units of Edgewater pursuant to a private placement.

6. JPMORGAN CHASE & CO: JPM recently traded at $40.8 and has a 2.5% dividend yield. JPM has gained 56% since the end of March 2009, underperforming the SPY 10.5 percentage points. The stock has a market cap of $162 billion and P/E ratio of 9. Paulson had $230 million invested in JPM shares. Hedge funds had $7 Billion in JPM at the end of March. Steve Heinz's Lansdowne, Jonathan Jacobson's Highfields Capital, and Andreas Halvorsen's Viking Global are among the hedge funds with huge JPM positions.

7. BOSTON SCIENTIFIC CORP: BSX recently traded at $6.79. BSX has lost 14.6 since the end of March 2009, underperforming the SPY by a large margin. The stock has a market cap of $10.4 billion and P/E ratio of 18. Paulson had $108 million invested in BSX shares. Insider Monkey is also bullish about BSX because of recent multiple insider purchases. We expect BSX to outperform index funds over the next six months.

John Paulson's long-term investments in gold miners undermined his long-term performance. We think this is a temporary issue. If large US budget deficits persist over the next few years, we believe gold prices will go up and gold miners will perform extremely well.

Disclosure: I am long SPY and long physical gold.