"One potential hurdle in winning assets: the replicability of Pershing Square’s portfolio, which had 10 disclosed positions as of April. Investors who tried to go that route previously missed out on gains as the firm built positions, a person familiar with the matter said. They also missed out on complex hedging strategies that don’t need to be disclosed." Pershing Square primarily takes very long term concentrated long positions. Yes, you will have the price impact of Pershing Square capital against you if you just replicate their positions. Ackman has not been net succesful in shorting individual stocks and he has argued that he will not do that going forward. He made money on Covid, but it is not reasonable to expect that he will win big on hedging in general. Overall you will be much better off just buying the individual stocks in the very concentrated portfolio when it is disclosed every quarter because you save the extremely high management and performance fees.
(SEMAFOR) Liz Hoffman Evidence Is Bill Ackman’s empire more valuable than Blackstone? Ackman’s deal this week to sell 10% of Pershing Square to a group of investors values the investment firm at $10.5 billion. That’s about 32 times its expected pretax profits of about $300 million this year, people familiar with the deal said. That’s more than twice the trading multiple of KKR or Apollo, and bigger even than that of Blackstone, which owns $1 trillion worth of businesses. Pershing Square owns eight stocks. Private equity firms like Blackstone have to replenish their assets, raising new investment funds as they sell companies and return cash to investors. That’s time-consuming and expensive, and hinges on the dealmaking and fundraising markets being open, which neither is now. Pershing Square won’t: The money it raises in an eventual IPO, as soon as next year, is its to keep, and investors can only cash out by selling their shares to someone else. “Permanent capital” is a precious commodity these days, especially as the traditional private-equity fund model is showing its age. Lighter flavors can be seen everywhere. At gated property funds, like those run by Blackstone and Starwood, investors can take out a little of their money at a time — and they are, in droves. Life-insurance policies technically have to be paid back decades down the road. Pershing Square’s money never does. Its lofty valuation also assumes that the money will keep coming in. Ackman is targeting between $10 billion and $25 billion for a new, NYSE-listed fund that will buy the same handful of stocks he owns in his hedge fund. He’s also weighing a fund that would wager on “black swan” economic events like his pandemic-era trades that turned $200 million into $4 billion. As we wrote about last month, Ackman has been able to translate his center-right, social-media-enabled celebrity to financial gain. Shares of his Amsterdam-listed fund have risen sharply since he began speaking out in support of Israel and against what he sees as academia’s leftist bent — in spite of strict European rules that limit how much he can publicly shill for the fund. The US has no such rules, and Ackman is betting that his newfound fame and investing track record could bring in billions more. Ackman is a rare thing in finance: A good investor with a giant public persona that he feeds and waters regularly. Most people who make embarrassing amounts of money don’t like to talk about it (the late Jim Simons comes to mind), and some with bad track records turn to chest-beating to make up for it.