Paulson Said to Pare Bets on Recovery as Main Funds Decline

Billionaire hedge-fund manager John Paulson, whose $32 billion firm has been betting on an economic recovery by 2012, has pared bullish bets across his funds, according to a person briefed on the investments.

Paulson’s $3 billion Recovery Fund, a bet on his view that the global economies will rebound quickly, reduced net investments in securities that are poised to gain in value with a recovery to 107 percent of assets from 140 percent, said the person, citing a letter Paulson’s firm sent to clients. Paulson also cut bullish bets in his largest funds after they declined this year, the person said, asking not to be identified because the information is private.