“John Paulson is unassuming, as far as hedge fund managers go: His demeanor is quiet; his suits are somber; his offices are understated. His nerve, however, is formidable. Convinced that subprime mortgages would falter, the event-driven specialist did extensive research, hired staff with necessary expertise and in April 2005 began making a big bet, using credit default swaps to short the asset class. His timing was superb. Even as hedge funds with subprime exposure began imploding the Paulson funds exploded, with one-year returns three times those of the benchmark for the Paulson Partners Fund and six times the index return for the leveraged version of the merger arbitrage fund.” source...
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