Today is not a good day for Pershing Capital or Bill Ackman, as his short position on Herbalife (HLF) is looking progressively worse as closing time approaches. The session before he announced his short on December 18, 2012 saw a closing price of $42.50 and in the aftermath, it crashed 38% to around $26.06. So far, it has rallied 10.09% to a price of $44.06.
This, of course, says nothing about his questionable position in JCP, which has steadily fallen since Jan. 2. Additionally, Ackman's fund has underperformed over the past two years.
Dan Loeb (LLC), an outspoken rival of Ackman, opened a position with 8.9 million shares at the beginning of this year. Last year, his hedge fund beat the market and another of his funds saw net returns of 35%.
Is there any chance Ackman is right and the FTC will step in? Should he accept defeat and admit (with less than a 342 PowerPoint slide) that he was wrong?
What do you monkeys think?
EDIT: Unconfirmed reports suggest rally started with HLF dipping into their treasury stock budget.