Plus only 89% of all hedge funds are lagging the S&P, so you can bet that the rest of the industry is also facing massive redemption requests. With stocks at 5 year highs and a boat load of redemptions coming on 9/30 which marks the end of the quarter. The odds are good that fund managers will start selling to prepare for redemptions and when it comes to stocks or crowded theaters its probably best to be one of the first to hit the exits.
For Paulson D-Day may have arrived. It is also coming for hundreds of other underperforming funds who will now have to shift from net buyer to gross liquidator as their LPs demand their cash back ahead of the September 30 redemption deadline. Add that technical consideration to all the other September sell off woes.
In short – he who redeems first, redeems best.