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Hedge Fund Cuts Subprime Exposure Following Profits

02 Nov 2007

Paulson & Co. has cut its exposure to the subprime home loan market by 86% following massive gains on bets against the battered sector, reports Bloomberg News. The New York-based hedge fund manager said that it expects to continue profiting off home price declines and delinquent borrowers because its Credit Opportunities funds kept subprime-related “short” positions. At the same time the firm “felt it advisable to lock in most of the gains,” according to an investor report. Paulson & Co. has doubled assets under management to $24 billion this year.

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02 Nov 2007