How John Paulson Bet Massively On Gold At Just The Right Time ... And Still Lost Money

John Paulson's Gold Fund is down 10% year to date, according to CNBC's Kate Kelly, this after dismal performance in 2011 and 2012.

Although it's true that gold has not done so hot of late, it's still had an amazing run over the last several years.

So what happened?

Kelly explained.

"The irony is that Paulson's been absolutely right about gold from April 2009 when he first put his trade on to now the yellow metal is up more than 70%," Kelly reported. "But Paulson has never dealt with physical gold as part of his trade. He's focused instead on mining and production stocks primarily, and that's where the pain has been. Looking at a basket of 6 key holdings that he's had, their down an average 32% since he bought. The only one... that's in the black is Rand Gold Resources that's up 1%..."

Kelly added that Paulson has no intention of closing down the $900 million Gold Fund, he's now presenting it to investors as a 'Black Swan' option in case inflation hits.