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- John Paulson predicted stubborn inflation and a potential gold-price surge in a recent interview.
- The billionaire investor's latest portfolio update backs up his comments.
- Paulson owned a dozen mining stocks and invested in energy stocks last quarter.
- See more stories on Insider's business page.
Billionaire investor John Paulson rang the inflation alarm and trumpeted gold's prospects in a Bloomberg interview this week. His stock portfolio shows he's betting his beliefs, as he's loaded up on mining and energy companies that stand to profit from rising prices.
Paulson is best known for betting on the housing bubble to burst, a wager that generated more than $15 billion for his fund. His big short was immortalized in the book "The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History."
The investor – who converted his Paulson & Co. hedge fund into a family office last year – expects stubborn inflation to spur interest-rate hikes and spark an exodus from cash and bonds into gold, he told Bloomberg. The combination of a demand surge and limited supply could supercharge the precious metal's price, he added.
Paulson's outlook likely explains why there were a dozen mining companies, including Barrick Gold and Novagold Resources, among the 40 holdings in his stock portfolio at the end of June. His mining positions were worth a combined $800 million, representing 20% of his portfolio's total value.
The investor also bet on energy companies last quarter, likely in anticipation of higher commodity prices. His family office bought stakes in the likes of BP and Shell, and boosted its positions in Occidental Petroleum by 66% and Exxon Mobil by 50%, making them its 7th and 12th most-valuable holdings, respectively.
Paulson turned his gaze to China as well, perhaps to hedge himself against a worsening US backdrop. He revealed a $157 million stake in Didi, as well as $4 million stakes in both Alibaba and Baidu.
Paulson may have switched out several holdings in anticipation of higher inflation, but he didn't touch his two largest positions: a $760 million stake in Bausch Health and a $748 million stake in Horizon Therapeutics.