MARKET turmoil usually spells good news for someone. When America’s housing market collapsed, the beneficiaries were hedge-fund managers such as John Paulson of Paulson & Co, who made $15 billion shorting subprime mortgages in 2007. Why, then, has the euro-zone crisis not produced a Monsieur Paulson of its own? Despite more than two years of disarray, funds with double-digit returns are rare; those with triple-digit returns are unheard of.
Dejected hedge-fund managers blame political meddling for their flagging performance.
Markets have whipsawed in response to announcements in Brussels: managers who have a good month often suffer the next. Shorting the euro, an obvious trade for euro bears, has not worked because the currency has not yet tanked, partly because of a rush for Bunds.
Why no hedge fund has made a killing out of the euro crisis | The Economist
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Seeded on Mon Jul 30, 2012 8:25 AM

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