[ad_1]
Over the past year, hedge fund manager Bill Ackman may have become better known as an X culture warrior than as a high-profile investor. But while Ackman posted several times a day on X (formerly Twitter) dabbling in anti-vaccine theories and opposing diversity mandates on college campuses, He continued to make money.
Mr. Ackman, who owns 21% of Pershing Square Holdings, plus performance fees, is likely to have earned at least $600 million in 2023, based on the information below. Institutional investor Calculation of Fund Returns. The publicly traded hedge fund rose 26.7% on a net basis in 2023, according to fund documents. This was slightly higher than the S&P 500’s total return (up 26.3%).
Such impressive returns come as a surprise, as executives who dabble in non-financial matters are often pegged by investors who believe they will take their eye off the ball and underperform. It may seem like the right thing to do. But in a sense, Ackman freed himself. In 2022, he appointed his longtime partner Ryan Israel as the firm’s chief investment officer.
Last year’s biggest gain came from Chipotle Mexican Grill, Mr. Ackman’s last activist fast-food success and now the hedge fund’s second-largest fast-food restaurant. . Chipotle is up 64% in 2023, more than 4.5 times what Pershing Square originally paid for the stock in 2016.
The next best-performing stock was Google’s parent company Alphabet, which became Pershing Square’s third-largest holding after its futures swaps were converted into stocks in the third quarter. Although the company didn’t own Google through 2023, its stock price rose about 60% in 2023.
Other Pershing Square stocks with double-digit gains over the year included Hilton Worldwide Holdings, up 41%, Loews Companies, up 21% and Restaurant Brands, up 17%.
The only loss was Mr. Ackman’s bet that interest rates would rise. The short-term bet cost the fund $200 million in losses last year, Mr. Ackman said on a conference call from Pershing Square in November. The bet turned out to pay off in 2022, but Ackman stayed at the party too long. As of August, he was predicting further interest rate increases and had a huge short interest.
By mid-October, Mr. Ackman announced on X that he had closed his short sales because “the risks are too great to continue shorting bonds at current long-term interest rates.” Ackman said he expects rates to fall, perhaps as early as the first quarter of 2024, and he has been long on rates.
All of Pershing Square’s stocks rose, but the stocks with which Mr. Ackman is personally most involved fared poorly. For example, Mr. Ackman is on the board of his group Universal Music, which is Pershing Square’s largest position, accounting for about 25 percent of the company’s portfolio at the end of 2022. Mr. Ackman had expected a now-defunct special purpose acquisition company to acquire the stock. But the Securities and Exchange Commission invalidated the plan, and hedge funds intervened. The stock was one of the laggards in 2023, rising only about 8% for the year.
Another underperformer is Howard Hughes Holdings, a real estate investment trust where Mr. Ackman is chairman of the board. The stock rose 10% in 2023, at least in part because Pershing Square has been adding to its stake throughout the year. Hedge funds currently own 38% of the company’s stock.
[ad_2]
Source link
