I'll be honest here - ever since I read the terrific "Confidence Game: How Hedge Fund Manager Bill Ackman Called Wall Street's Bluff" by Christine S. Richard, I've had somewhat of a professional man-crush on Bill Ackman. There's just something hilariously awesome about a guy who is as big of an asshole as he is brilliant, something romantic about a guy fighting the odds and the industry, knowing he was right as his name and firm were dragged through the mud, only to come out on top.
Since then, he hasn't disappointed either. Between making the news seemingly every other week or his high profile showdown with Carl Icahn on live TV, the guy entertains.
He has also lost $2 billion so far this year. Let that sink in for a moment. $2,000,000,000.00 gone...
Pershing Square Capital Management LP has suffered setbacks with a soured stake in J.C. Penney Co. and a big bet against Herbalife Ltd. that is underwater. In a letter to investors dated Oct. 2, Mr. Ackman said he had restructured the Herbalife position to limit the risk of further losses.At the end of September, Pershing Square's total assets under management stood at $11.2 billion, according to a person familiar with the matter. That is a $2 billion decline from the $13.2 billion that Pershing Square reported it had under management as of March 1 in a filing with the Securities and Exchange Commission.
The larger figure would have been near Pershing Square's peak for the year, because it generated about a 13% gain in the first quarter, the person said. The $2 billion decline represents a 15% drop in assets under management.
Even in the hedge-fund world, in which small fortunes are won and lost regularly, Mr. Ackman's downswing is significant.
Pershing Square told its investors in the letter, which was reviewed by The Wall Street Journal, that its main fund was up 0.5% for the year through the end of September, net of fees. That compares with a 20% return for the S&P 500-stock index in the first nine months of the year.
Pershing Square raised a new fund of nearly $500 million recently to finance its latest activist investment, a large stake in Air Products & Chemicals Inc. APD -1.64%At Mr. Ackman's urging, the company agreed to replace three of its directors, and its CEO, John McGlade, agreed to retire by next June 30.
In his Oct. 2 letter, Mr. Ackman said accepting losses when necessary makes his firm better. "Confidence and conviction without humility can be dangerous in the investment business," he said.
Read more: http://online.wsj.com/article/SB100014240527023037226045791136616164915…
This is coming from a guy whose ego and arrogance are legendary. Whether or not you like him or think he's crazy or not, you have to admit that he's as close to pure entertainment as it gets in the world of finance.
He's a smarter version of Paulson. Paulson had his CDS play drawn up by paolo. Ackman had his fortune with GGP and shorting MBIA. Since then they accumulated a metric ton of cash, and their returns have frankly sucked.
^ agree
Any person that cries during a conference is entertainment in my books
Its AUM loss on dollar loss
I remember when Ackman was tootin' his own horn with Herbalife.
it's not a real 2 billion dollar loss.
some investors probably w/d some money and the fund is down a few percentage points, doesn't seem like a big deal.
The interesting thing would be to know what his losses on JCP and Herbalife amount to, and what his other picks are that offset them.
most hedge funds are not performing good at all
Index ETFS yo
It's all bullshit. The whole hedge fund industry is bull shit. This guys can't make money when everyone else is. These managers take credit for "generating alpha" when in reality it's just luck. It's a random variable that isn't sustainable and which is always zero in the aggregate.
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