Key Paulson funds gain but gold fund drops in July

Thu Aug 5, 2010 3:57pm EDT

* Paulson July numbers point to recovery

* Advantage fund gained 1.1 percent last month

BOSTON Aug 5 (Reuters) - Investors in many of John Paulson's hedge fund were treated to gains in July as markets recovered some ground, but his gold fund suffered big losses, people familiar with the numbers said on Thursday.

The flagship Advantage fund gained 1.1 percent in July, leaving the fund off 4.79 percent for the year to date.

The Recovery Fund, where Paulson made his big bets on banks recently, gained 6.51 percent last month, leaving the fund up 9.11 percent for the year.

And the Credit Opportunities fund rose 0.97 percent in July, leaving it up 6.49 percent.

Paulson's gold-oriented fund, the New York-based fund firm's newest offering which launched this year, tumbled 5.93 percent in July, but is still up 5.7 percent of the year.

With roughly $31 billion in assets, Paulson is one of the world's biggest hedge fund firms and his returns have been watched closely since his 2007 bet against the U.S. housing market earned his firm about $15 billion.

Hedge funds are not required to make their returns public.

Clients received a 40-page long report from Paulson this week where the manager analyzed what happened during the second quarter and gave a taste of his current views.

After having told investors in May that he expected the economy to bounce back strongly, Paulson in the letter altered his outlook slightly, going from what one investor called an "exuberant to a bullish outlook."

The quarterly report did not include July's numbers which were being compiled and released to investors on Thursday. (Reporting by Svea Herbst-Bayliss. Editing by Robert MacMillan)

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California state worker Albert Jagow (L) goes over his retirement options with Calpers Retirement Program Specialist JeanAnn Kirkpatrick at the Calpers regional office in Sacramento, California October 21, 2009. Calpers, the largest U.S. public pension fund, manages retirement benefits for more than 1.6 million people, with assets comparable in value to the entire GDP of Israel. The Calpers investment portfolio had a historic drop in value, going from a peak of $250 billion in the fall of 2007 to $167 billion in March 2009, a loss of about a third during that period. It is now around $200 billion. REUTERS/Max Whittaker   (UNITED STATES) - RTXPWOZ

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