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This might be Bill Ackman’s most impressive trade ever and he once turned $60M into $1.6 billion on a bankrupt penny stock. Ackman sold a piece (GP Stake) of his hedge fund for $1.05 billion this week. This counters a common objection we get on GP Stakes Investing: "Isn't it a bad sign if an investment firm wants to sell 10% of their money printer???" But Ackman is arguably the most ambitious investor on earth. Here is his take: "I'm selling 10% of Pershing Square to help accelerate our growth in assets under management in existing and new strategies.” Even the most successful investment firms view minority GP capital as a strategic weapon for growth. However, short of one of the Pod Shops (think Ken Griffin's Citadel) that make money in every market, I wouldn't recommend investing in hedge fund ownership. Hedge funds were how the GP Stake business got started and the returns were in a word...meh. Too much reliance on one man: - Who can have a bad day and blow up the firm - Who could wake up one day and decide to be a Buddhist monk - Who could piss off his investors and have massive redemptions in 90 days Now, I wouldn't bet against Ackman, he's already an investing legend. But we'll stick to investing in private equity firms with giant teams, multiple strategies and 7-10 year management fee contracts on long-term capital commitments. And at a fraction of the earnings multiple than this reported deal, which was valued at staggering ~64% of its ~$16 billion under management. In other words, this is an UNREAL deal for Bill. He'll still likely supercharge AUM growth and make these Stake investors money. But we'll stick to private equity GP investing, which is a more conservative way to earn high income and stellar returns in our view.

Pershing Square's Shift to Permanent Capital Mirrors Buffett's Influence Bill Ackman, the founder of Pershing Square, draws inspiration from Warren Buffett's career as he implements a long-term investment strategy at his hedge fund. With nearly 90% of its $18.7 billion assets in permanent capital, Ackman aims to foster stability and focus, free from the pressures of short-term investor withdrawals. Ackman is launching Pershing Square USA Ltd., a closed-end fund designed to replicate the successful model of Pershing Square Holdings, a $15 billion closed-end fund trading in Europe, and potentially lead to an IPO of his management company. This strategic move reflects his pursuit of long-term stability, similar to Buffett's approach. The roadshow for Pershing Square USA Ltd. targets investors valuing stability and the benefits of a closed-end fund structure. Ackman believes this model offers better investment decisions and improved returns over time, contrasting with the volatility and short-term pressures of traditional hedge funds. # Thank you Hiroki Tanaka for your submission!

*How Did Ray Dalio Redefine Investing?* Imagine transforming a two-bedroom apartment into the world’s largest hedge fund. Sounds like a dream? Well, Ray Dalio made it his reality. Founder of @BridgewaterAssociates Recebtly i was intrigued by Dalio’s journey which is nothing short of inspirational, showcasing what vision, perseverance, and innovative thinking can achieve in the vast ocean of finance. From his early days, Dalio didn’t just participate in the financial markets, he aimed to understand the underlying principles that govern them. This deep dive into economic patterns led to the creation of Bridgewater Associates in 1975, which today manages about $150 billion in global investments. His approach? A unique blend of radical transparency, collective decision-making, and a principles-driven investment strategy. But Dalio’s impact extends far beyond Bridgewater’s success. His insights into the economy, risk management, and investment strategies have influenced countless individuals and institutions. His hedge fund posted the second highest gains of any hedge fund since its inception in 2022 using merely a simple trasparent stratergy His report work, “Principles: Life and Work,” is not just a book but a manual for success in life and business. What’s your take on his investment philosophy?💡 Share your views, and thoughts on how Ray Dalio’s groundbreaking strategies have reshaped our understanding of finance and investing. #RayDalio #BridgewaterAssociates #FinanceInnovation #InvestmentStrategies #EngageWithUs

Billionaire investor Ackman kicks off fundraising for new US fund Hedge fund manager Bill Ackman kicked off fundraising for a new U.S.-listed closed-end fund on Tuesday. The new fund, Pershing Square USA Ltd, will offer lower fees for investors and quicker access to capital than traditional hedge funds, regulatory filings show. There will be no management fee charged for the first year after the fund's initial public offering and no performance fees ever. It will be listed on the New York Stock Exchange and be available to anyone who can invest in the U.S., including pension funds, endowments and retail investors. Roughly 80% is expected to be raised by institutions, with retail investors making up the rest, a filing made Tuesday shows. Ackman, a heavy user of social media platform X, referenced the fundraising on Tuesday when he messaged his 1.3 million followers "I am going to be busy for the next few weeks. $PSUS!!" Investors, including ones unable to write the multimillion-dollar checks Wall Street hedge funds traditionally demand, can pay $50 a share for the new vehicle. #billackman #retailinvestors #newlaunch #wallstreet #money #X #socialmedia #hedgefund # source : reuters

Ken Griffin Dumped These 3 Stocks From Citadel Advisors by Rich Duprey via 24/7 Wall St. ([Global] oracle cloud) URL: https://ift.tt/K6hzUAP You can say hedge fund operator Ken Griffin likes diversification. His Citadel Advisors has almost 7,000 positions in its portfolio. With more than $102 billion in assets under management, the hedge fund ensures that no single stock will hurt its performance if it fails. Whether an individual investor should be so broadly diversified is another question. A portfolio of two or three dozen stocks should give you the diversification you need over sectors, industries, and geographies without turning yourself into an all-market index fund. Yet Griffin has been an extremely successful investor. His flagship Wellington Fund has generated 19.6% annualized returns since its founding in 1990, nearly twice the S&P 500 and on par with Warren Buffett, though the Oracle’s has done that for 60 years running. While Griffin did add a bunch of new stocks to his portfolio last quarter, while also selling out of several, among the portfolio’s biggest holdings were a number of positions that saw the billionaire make significant reductions. The following three stocks were the ones that he trimmed the most. Key Points About This Article: Ken Griffin has been one of the most successful investors over the past three decades, generating annualized returns of nearly 20% for his flagship Wellington Fund since its creation in 1990. The billionaire investor has an incredibly diversified portfolio with nearly 7,000 positions in Citadel Advisors, but Griffin recently slashed a few of his more prominent holdings. If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report. It features a software stock we’re confident has 10X potential. PayPal Holdings (PYPL) Payments platform PayPal Holdings (NASDAQ:PYPL) has faced harsh headwinds in recent years as competition edge in on its industry dominance and the online shopping boost of the pandemic normalized. Although revenue and profits were challenged, new CEO Alex Criss is turning the ship around. Because PayPal has its feet planted firmly on both sides of a transaction with offerings for merchants and consumers, it is fairly distinctive in the space though that could rapidly change in the near future. Yet the payments platform has its own competitive strengths. Its Braintree mobile and web payments system is quickly emerging as a robust, profitable contributor to PayPal’s performance.  Braintree’s volumes grew 19% in the second quarter and began contributing to transaction margin dollar growth (that’s essentially PayPal’s gross profit line). Transaction margin dollars rose 8% in the quarter to $3.6 billion. Despite this improved performance, Griffin was selling down his stake in PYPL stock, shedding off some 2.4 million shares. He still owns a significant amount, or about 6.3 million shares, which are...

Where have all the hedge fund superstars gone? The days of investors trusting a star hedge-fund manager with their cash are in the rearview mirror, writes Business Insider's Linette Lopez. Unlike years ago, hedge funds are no longer the only game in town for institutions or the ultra-wealthy looking to park their cash somewhere. Venture capital, private credit, and private equity have grown considerably over the past decade. And the big names that remain in the industry are starting to resemble Wall Street banks in their size and complexity. More on Business Insider #hedgefunds #wallstreet #investing

I see many parallels to hedge funds I coach in this article about D1 (PM Dan Sundheim , ex Viking). During periods of poor short book performance many fund managers swap single stock shorts for ETFs.  Unfortunately, the factor mismatch between long and shorts coupled with the lack of alpha shorts causes further poor performance and risk problems. The manager typically reverts back to single stocks; especially if LPs protest the ETF exposure relative to the fees they are paying. An added hidden cost of giving up on single stock shorts is the negative impact on long idea generation. Paradoxically, a real source of long ideas is the deep mosaic research required to generate shorts. D1 also experienced what I like to call, the overconfidence loop, whereby strong unrealized performance leads to high gross exposure and high position level concentration. This often results in drawdown. D1 PM Sundheim evolved by eliminating ETF shorts and increasing position count in a broader set of sectors.  We can discuss if this will be enough to sustain improved performance. In my opinion, these changes are responses to the symptoms and not the causes of the poor performance.  https://lnkd.in/gQv2QzR2 #hedgefunds #institutionalinvestor #allocator #primebrokerage

"In the first twenty years of his fund’s life, Alfred Winslow Jones earned his investors a cumulative return of just under 5000%." This incredible achievement is the foundation of the hedge fund industry as we know it today. Jones, a former journalist with no prior investing experience, started the world’s first hedge fund in 1949. His innovative strategies, including the use of leverage and short-selling, revolutionised investing. He also introduced concepts like 'hedging' and the distinction between alpha and beta, ideas that are now cornerstones of modern finance. Jones’s journey, from a Marxist diplomat to the father of hedge funds, is a fascinating story of improvisation and brilliance. His fund’s success not only set the stage for the hedge fund industry but also demonstrated the power of innovative thinking in finance. For anyone interested in the origins of hedge funds and the evolution of investment strategies, this article is a must-read. It offers valuable insights into the history and foundational concepts that continue to shape the industry today. #hedgefunds #investmentstrategy #financialmarkets #alpha #beta #pioneers https://lnkd.in/diTa2gA9

Kenneth Griffin is an American hedge fund manager, entrepreneur and investor. He is the founder and 80% owner of Citadel LLC. One of his first investments was to buy put options on Home Shopping Network, making a $5,000 profit. He also invested in convertible arbitrage opportunities in convertible bonds. His first fund launched in 1987 with $265,000, days after his 19th birthday. He was recently interviewed by Nicolai Tangen, the CEO of Norges Bank Investment management. The full link of the interview is in the comments section. Here a few key lessons from Griffin Look how to make risk-free profits. He made a lot in convertible bonds: “The market maker made a risk-free profit. And I was very interested in trying to learn about the pricing of derivatives and that took me to understanding the pricing of convertible bonds, which is the area that I started in, from my college dorm room when I began my first hedge fund.” Learn from your winners: “I’ve made every mistake you could possibly make, and I made them some 2 or 3 times. The key in finance though is to try to learn from both, your mistakes, and your successes. And I think that something people do too often is that they don study their winners. They don’t learn what they got right in that winning trade. Because let’s be clear. You make money in finance when you have winners.” Do your research: “Trading is simply how we monetize our research. It is that simple.” Use math and software. Look for a competitive advantage: “I believed you could use mathematics and software to help you understand these price relationships in a world where most participants were still using paper and pencils and rules of thumb…..We did manage to ride the wave of the rise of mathematics and science in finance”. #trading #quant #finance #markets