How has John Paulson Achieved His Success?

With a net worth of more than $11 billion and a fund of about $19 billion under management, John Paulson is regarded as one of the leading persons in high finance. Here is what makes Paulson a prominent person in the financial world.

Paulson’s Early Life and Education

Paulson was born in 1955 in New York. He was a bright student from an early age, joining New York University in 1973 to pursue business and public administration. Later, he enrolled at the Harvard Business School, where he graduated in 1980 with a master’s of business administration.

Early Career

John Paulson is a risk taker because he took a break from college in the 1970s to travel to Ecuador to chase an entrepreneurial career. While in Ecuador, he established his first business of exporting kids’ outfits to department stores in New York. However, the venture was not sufficiently successful, and Paulson returned to college to continue with his studies. After graduating with an MBA, he worked for Bar Sterns, Odyssey partners, and Gruss Partners.

Paulson and Co.

Although he founded Paulson and Co. in 1994 with about $2 million, this company currently manages about $20 billion. During its peak, the company’s fund managed about $38 billion. The company emphasizes event-driven arbitrage strategies, such as distress credit, bankruptcy reorganization, M&A arbitrage, and structured credit.

John Paulson became famous in 2007 following the financial crisis. His company made a profit of $15 billion in 2007 alone due to various shorts and bets against the housing market. During the financial crisis period, john’s bearish view of the credit market surpassed housing and expanded from customer to corporate debt. At one time in 2008, Paulson bet against multinational financial institutions in the United States and the United Kingdom, causing many to flop.

Although Paulson and Co. experienced incredible success during the financial crisis, it underwent a turbulent period in 2011. The firm lost about half its value after a bet on an early US recovery failed to go as planned.

Paulson’s Investment Philosophy

Paulson has two sayings that keep him moving forward. First, he watches the weaknesses, and the strengths care for themselves. This way, he can preserve principal and avoid losing money. Second, John says that risk arbitrage is not about generating money but not losing. Simply put, you can keep your earnings provided you minimize the downsides.

With a net worth of more than $11 billion and a fund of about $19 billion under management, John Paulson is regarded as one of the leading persons in high finance. Here is what makes Paulson a prominent person in the financial world. Paulson’s Early Life and Education Paulson was born in 1955 in New…

With a net worth of more than $11 billion and a fund of about $19 billion under management, John Paulson is regarded as one of the leading persons in high finance. Here is what makes Paulson a prominent person in the financial world. Paulson’s Early Life and Education Paulson was born in 1955 in New…