SEC filings are in for Q1 2010, so 'whale watching' season is on. We'll just focus on our normal few who make large directional and/or macro bets, starting with the now infamous John Paulson - the world's largest gold bug. :) The biggest news this quarter appears to be a new exposure to home builders, which does make sense based on all the looting... err, taxpayer giveaways.... given to these firms - along with historically low rates of home building, especially in light of continued population growth. That said inventories of foreclosures are going to remain high for years but all it takes is any second derivative improvement and Wall Street will kick in with glee. What *is* interesting is which name he chose - Beazer Homes (BZH); one of the smaller and more speculative names at $300Mish market cap... rather than a Pulte (PHM), Lennar (LEN) or DR Horton (DHI).

His large stake in Bank of America (BAC) - outside of being a beneficiary of the access to nearly free money from the Fed - can also be construed as a derivative on housing as BAC bought Countrywide early in the crisis and is now a behemoth in U.S. mortgages. And since no large company is allowed to fail in the United States anymore, debt laden MGM Mirage (MGM) is a sensible pick. With the size his hedge funds have grown to [Mar 8, 2010: List of Largest Global Hedge Funds] , he will need to take more high risk/high reward parlays to keep performance going. [Mar 29, 2010: Are John Paulson's Hedge Funds Now Too Big to Outperform]

Via Reuters:

  • Hedge fund manager John Paulson, who correctly bet that housing prices would fall three years ago, is now betting that the market will come back soon and added a homebuilder to his portfolio while raising his stake in the country's leading bank.
  • Paulson's New York-based Paulson & Co raised its holdings in Bank of America (BAC), already one of his top 10, by 11 percent to 167.8 million shares, according to a regulatory filing released on Monday. The Charlotte, North Carolina-based bank remained Paulson's second-largest position, valued at $2.99 billion at the end of the first quarter. Late last year, Paulson told investors that he expected Bank of America's stock price to almost double in two years, expecting it to rise to $29.81. Shares closed at $16.35 on Monday.
  • Paulson's holding in Citigroup, his third biggest, was unchanged at 506.7 million shares.
  • The fund manager kept his biggest position in SPDR Gold Trust (GLD), which was also unchanged at 31.5 million shares in the first quarter.
  • Perhaps most notably, Paulson bought 5 million shares in Beazer Homes USA (BZH) , marking an unusual move among most hedge fund managers who concentrated more on financials and other big industries.
  • A week ago Paulson told investors that he expected to see a strong economic recovery plus a rebound in housing prices.
  • The fund manager also bet big on casino owners on MGM Mirage (MGM) and Boyd Gaming Corp (BYD) during the first three months of the year.
  • Paulson's firm manages about $35 billion and the filing made on Monday shows about $21.2 billion in holdings.

[Nov 18, 2008: Paulson Buying Mortgage Backed Securities]

[Feb 17, 2009: Hedge Funds Pile into Citigroup; as does Bruce Berkowitz of Fairholme Funds]

[May 16, 2009: John Paulson Continues to Pile Into Gold]

[Aug 12, 2009: John Paulson Makes Bank of America 2nd Largest Holding after Gold]

[Aug 26, 2009: Citigroup Surges on John Paulson Investment]

[Nov 19, 2009: John Paulson Set to Launch Gold Hedge Fund]

[Dec 9, 2009: Hedge Fund Titan John Paulson Bullish on Bonds... Equities Not too Shabby Either; Inflation Concerns Remain]

Long Lennar in fund; no personal position