Tuesday, February 3, 2009
Paulson's merger arbitrage commentary is particularly interesting, in the sense that buying Anheuser-Busch stock would have been an incredibly risk-averse investment over anything but the short-term; and the upside was a 90% return when calculated on an annualized basis. This is a strategy that almost anyone could have implemented.
Also, Paulson explains the reasoning and analysis behind his historic bet against subprime and financials, which is extremely valuable reading. Paulson states that we are halfway through the crisis; yet he has liquidated his bets against subprime and is beginning to make select investments in distressed debt and other long positions within the credit and financial space.
Going forward, he makes it very clear that being a long investor in financials will generate immense returns when the markets rebound, throughout either 2009 or 2010.
Paulson Funds Annual Report