The Ackmanaissance, that remarkable and improbable turnaround in Pershing Square Capital Management founder Bill Ackman’s fortunes from the depths of humiliation and failure to the heights of the hedge fund world, did not begin, as is commonly believed by romantics, when he even more improbably wrested the affections of a brilliant and beautiful woman from the arms of Brad Pitt. Instead, the spark was a 50-year-old letter written by Warren Buffett.
This will not surprise the more seasoned Ackmanologists, who know well of his debt to and aspirations to become a successor to the Oracle of Omaha. The relationship has had its ups and downs (and then some more downs, and some more after that), but Ackman remains, at heart, a man of the Berkshirean persuasion.
The current crisis, however, has exposed the limits of Ackman’s fealty to Buffettian principles (to say nothing of his ability to predict what the great man himself might do): While Buffett and Berkshire remain on the sidelines, suffering huge losses, Ackman has plunged into the COVID-19-plagued markets with histrionic gusto and great success. And so, it is at last time for the student to leave the master’s next, and make his fortune and future on his own.
The public and private funds at Pershing Square Capital Management have gained between 22% and 27% this year, handily beating both the Standard & Poor’s 500 index and the average hedge fund which are each off 7% since January, Ackman said…. Positions in Berkshire Hathaway, Blackstone Group and Park Hotels & Resorts were liquidated because the cash could be used more efficiently elsewhere, he said.