Paulson thinking of betting on the mortgage upside. But not quite yet

John Paulson, the hedge fund guy who made the spectacularly dead-on bet that the market for mortgage securities would go haywire last year (and took home a paycheck in the vicinity of $3.7 billion in the process), is planning a new fund that would invest in financial companies.

The fund would "provide capital to financial firms hurt by mortgage writedowns," Bloomberg reports (via Trader Daily). Paulson apparently said something along these lines at a hedge fund get-together in Monaco last month.

"We're trying to see the right entrance point,'' he said at the Monaco conference. "If you invest too early, you lose money.''

Right now is apparently still too early. Bloomberg reports that the fund "may open by December."