John Paulson has so far received $1.5 billion in redemption requests as of Friday, according to a knowledgeable source.
This works out to 5 percent of the firm’s total assets of $30 billion, which are up from $27 billion thanks to strong performance in the October market rally.
If Paulson does not get a sudden surge of redemptions by the Monday deadline, the total will wind up much less than many experts had anticipated.
In addition, Paulson is allowing existing investors to put additional money into any of the firm’s funds, and won’t charge a performance fee until that particular fund hits its high water mark.
Paulson, who has made a huge bet on gold as well as on securities that benefit from a strong, recovering economy has seen many of his funds lose between 20 percent and 47 percent this year.
This could mean he won’t earn performance fees for several years.
After all, Citadel’s Ken Griffin, who lost 55 percent in 2008, still has not hit his high water mark.
In September we reported certain Citadel investors had finally gone over the high water mark. Sources told us at the time all investors should be able to reach that magic level once the funds climb another 6 or 7 percentage points, a good possibility it occurred in October given the overall surge in global stock markets.
