Bill Ackman targets Main Street investors with new Pershing fund

Bill Ackman targets Main Street investors with new Pershing fund
Hopes are high for the proposed vehicle, which 'has the potential to be one of the largest closed-end funds,' according to the prospectus filed with the SEC.
FEB 08, 2024

Hedge fund mogul Bill Ackman is looking to meet individual American investors where they are with his next investment fund.

The Pershing Square USA Ltd. fund – which still awaits regulatory approval – is set to be listed on the New York Stock Exchange under the ticker PSUS.

Structured as a closed-end fund, it aims to invest in a mix of 12 to 24 large-cap and "durable growth" core holdings focused on the North American market, according to a prospectus filed with the SEC.

Ackman has built a reputation for achieving market-beating returns by running concentrated portfolios. The star investment manager’s hedge fund, Pershing Square Capital Management, ended last year with a 26.7% return, while holding only seven stocks, including Google parent Alphabet, Chipotle Mexican Grill and Universal Music Group.  

While it posted a loss of 8.8% in 2022, the fund still managed to beat the market as the S&P 500 suffered a near-20% drawdown for the year.

"The Adviser believes that the Fund has the potential to be one of the largest, if not the largest, listed closed-end funds and expects that the Adviser’s brand-name profile and broad retail following will drive substantial investor interest and liquidity in the secondary market," the filing says.

While hedge funds have typically come with a 2-and-20 fee structure – a 2% management fee charged on assets invested and a 20% fee on profits a given fund generates – Ackman says he will be waiving the management fee for his Main Street fund during its first year, after which a 2% fee will be charged annually.

As noted by the Wall Street Journal, a similar fund, Pershing Square Holdings, is also available to investors across the pond via European stock exchanges. Just over three years ago, Ackman launched Pershing Square Tontine Holdings in a high-profile SPAC IPO that drew $4 billion from investors. That SPAC was poised to gain a minority stake in Universal Music Group at one point, but the deal fell through in the face of opposition from the SEC.

Ackman's net worth stands at approximately $4.2 billion according to Forbes, making him the world’s 698th richest person.

Investors need to know the differences between actively managed ETFs

Latest News

SEC bars ex-broker who sold clients phony private equity fund
SEC bars ex-broker who sold clients phony private equity fund

Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.

The key to attracting and retaining the next generation of advisors? Client-focused training
The key to attracting and retaining the next generation of advisors? Client-focused training

From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.

Chuck Roberts, ex-star at Stifel, barred from the securities industry
Chuck Roberts, ex-star at Stifel, barred from the securities industry

"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.

SEC to weigh ‘innovation exception’ tied to crypto, Atkins says
SEC to weigh ‘innovation exception’ tied to crypto, Atkins says

Chair also praised the passage of stablecoin legislation this week.

Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest
Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest

Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.