Prior to the 2007 meltdown of the subprime lending
market, hedge-fund manager John Paulson was a name with a solid reputation for performance, but not necessarily put on the same pedestal with the likes of George Soros or Warren Buffett. The primary fund he manages, the Advantage Fund, has averaged a 15.4% annual return since its inception in 1994. That's solid, but not earth-shattering.
After going against the grain and betting against the housing market in 2007, though -- and generating a $15 billion profit (a nearly 600% return) for his fund's investors as a result -- the 56-year-old Harvard MBA grad established himself as one of the elites among Wall Street's stock-pickers.
The money soon followed, as investors warmed up to the idea of not following the rest of the trading crowd. Paulson now manages $29 billion in assets, making him the head of the world's third-largest family of hedge funds.
Though steering such a vast amount of money makes it tough to step into off-the-radar opportunities and acquisition targets (his favorite), Paulson still has a penchant for owning stocks the rest of the market's key players aren't really considering.
The additions he made to the portfolio in the fourth quarter of 2011 are no different. While they may be surprising, his track record still makes these names worth considering yourself. Here's a look at some of Mr. Paulson's fourth-quarter purchases that you may also want to consider.
1. United Rentals (NYSE: URI)
An equipment rental business may not be the most riveting idea out there, but United Rentals may well have the makings of a buyout target.
Revenue for the $2.6 billion company is improving following the 2010 lull, and the company swung back to a profit in the middle of last year. United Rentals also has $500 million worth of cash and near-term receivables on the balance sheet.