Net Net: Promoting innovation and managing change
Net Net: Promoting innovation and managing change

Paulson's Hedge Fund Losses Mount

John Alfred Paulson, president of Paulson & Co., Inc.
TimSloan | AFP | Getty Images

The largest hedge fund run by well-known manager John Paulson is down 21 percent for the year. The Advantage Fund, which has over $17 billion in assets under management, suffered losses between 10 and 11 percent since the start of August.

The Advantage Plus fund, a levered version of the Advantage Fund, is also losing money. It is down 31 percent for the year, after seeing losses similar to the Advantage Fund’s for August, according to an investor source who spoke to CNBC’s Kate Kelly.

The August losses at the funds were reported earlier by CNBC’s Maneet Ahuja.

Despite the August losses, both funds are outperforming the S&P 500, which is down 16 percent for the month. And investors aren’t exactly running for the doors. The fund said in a letter to investors that redemptions remain at normal levels, Ahuja reported.

At a conference for Advantage Fund investors in May, Paulson warned that they should be prepared for volatility over the short term.

Paulson's investors are used to volatility by now. The funds were so double digit losses last year before rallying in the later half of the year to end 2010 up 11 percent.

Questions? Comments? Email us at

Follow John on Twitter @

Follow NetNet on Twitter @

Facebook us @