Caesars casino drop affecting Paulson

Caesars Entertainment Corp dipped almost 11 percent as lenders exited talks over restructuring its largest unit. The casino operator has declined -38.16 percent  this year, weighing down the investment portfolios of Leon Cooperman, John Paulson and George Soros.

Paulson Recovery Fund to be renamed Paulson Special Situations Fund

Paulson Recovery Fund will be renamed Paulson Special Situations Fund on Jan. 1, 2015, after concluding that the five-year-old U.S. recovery has matured.

Amendments to the fund’s mandate will render it more similar to Paulson’s event-driven Advantage funds, which wager on the outcomes of takeovers, spinoffs and corporate bankruptcies. Existing investors have been offered the chance to redeem their shares in light of the changes.

Paul sticks with GLD and Gold miners

John Paulson’s hedge fund, Paulson & Co., maintained its stake in the SPDR Gold Shares during the third quarter even as gold prices have declined recently. Paulson & Co., the largest GLD shareholder, made no adjustments to its GLD position for a fifth consecutive quarter.

At the end of the third quarter, Paulson owned over 10.2 million shares of GLD. GLD is Paulson’s second-largest equity position behind Irish pharmaceuticals firm Shire.

In addition to GLD, during Q3 Paulson also maintained stakes in gold miners, including Randgold Resources, Agnico-Eagle Mines, Gold Fields, Sibanye Gold and IAMGOLD.

John Paulson cites high risk reward potential on deals such as Shire

While the risks in these investments are higher than the risks of announced deals, we attempt to mitigate the downside by choosing targets that trade at discounted valuations and that could rise even if no takeover occurs, as well as by either partially or fully hedging the market exposure by shorting sector ETF's and/or individual stocks against the longs. Although the risk is greater and the outcomes are less certain, the rewards can be high.

Shire withdrawal hurts Paulson

Hedge fund billionaire John Paulson is getting whacked on his hedge fund's largest equity investment, the biotech company Shire. 

Shire plunged 23% in London, the Chicago-based pharmaceutical company AbbVie said it was reconsidering its $55 billion takeover bid of the Ireland-based Shire, Reuters reported.

Paulson still wants AbbVie to pursue its takeover of Shire. He owns 13 million shares of AbbVie.

"We believe this transaction creates enormous value for AbbVie shareholders. The combination is both strategic and accretive regardless of the tax considerations," the fund said in a statement emailed to Business Insider. "As a large AbbVie shareholder we hope the Abbvie Board reaffirms its commitment to the transaction after its review."

Merger arbitrage is Paulson's main specialty. 

Paulson owns MGIC and Radian

Billionaire John Paulson’s hedge fund firm is among the top five investors in MGIC and Radian, with combined stakes valued at about $300 million. Paulson & Co. also controls 1.8 percent of Genworth Financial Inc. (GNW:US), which sells life insurance and long-term care coverage in addition to mortgage guarantees. 

MGIC and Radian have said the proposed private mortgage insurer eligibility requirements, or PMIERs, are too strict and threaten to make home loans less affordable. Essent and NMI have praised the rules, saying the industry needs the financial strength to withstand another housing crash. 

Family Dollar bidding could help John Paulson

Dollar General had always been seen by some on Wall Street as the more natural buyer of Family Dollar until Dollar General’s CEO Rick Dreiling said in June that he would resign within a year. But Dreiling has now said he will stay on as CEO until May 2016. 

The winners of a bidding war for Family Dollar are its biggest shareholders, which include hedge funds run by billionaires Nelson Peltz and John Paulson. Carl Icahn is also a large shareholder.