Pershing Square Share Discussion Threads

[shareman1111] 03/1/2022 17:10

I also like that Bill has big skin in the game, around 20% I recall

[grahamg8] 03/1/2022 16:40

Hamid, standard share trade charge. No stamp duty. No management charge deducted, Bill Ackman's rake off comes as an expense within the overall performance. So what you see is what you get. It trades on a pretty tight spread too. For me the discount to NAV is a positive rather than negative as it is stable. More likely to shrink in the longer term rather than get bigger.

[hamid1970] 02/1/2022 10:21

Can anyone advise on trading fees / management charges with trading a FTSE listed trust like this. Do you pay stamp duty as per any FTSE stock.

I also assume there are no management fees etc if you just trade the FTSE listed PSH.

Thanks in advance

[shareman1111] 01/1/2022 12:03

1.5% was the initial investment

[shareman1111] 01/1/2022 12:03

Last I heard the it was around 1.5% of the total PF and was 6x up (I’m sure I recall that from either a video or the recent call)

[hamid1970] 01/1/2022 11:47

Does anyone understand the interest rate hedge and the amounts in play in any detail and when Bill may pull the pin? I guess there will be a point in time when he will think that interest rates / inflation will start to fall. Most pundits see inflation as a short term phenomenon

[shareman1111] 31/12/2021 17:27

The interest rate narrative is completely overblown, the market prices these things in advance also, the Fed are just shooting themselves in the foot with every interest rate increase, they might do one or two however from these crazy low levels it’s less of an issue for the highly cash generative stocks in PSH’s PF than most US Tech/high growth.

I expect a post Omicron US spending boom in Q1 & Q2 due to pent up demand then maybe the stocks will flatline or correction a tad in H2.

Bill has said many time the stocks have very good pricing power, he’s no fool and will have a good few ideas on how to keep the value rising and maybe one day the gap will narrow a bit. Investor presentation in January.

[donald pond] 31/12/2021 17:10

Looking forward 3/6 months I suspect we will see the end of covid and US inflation falling (US Gas had fallen off a cliff recently). With wages rising I suspect the US consumer isn't the worse sector to be exposed to

[williamcooper104] 31/12/2021 16:49

The idea will be to get paid out cash on the hedges and then use that to buy into core holdings at cheap prices Should mean a little less volatility and better long term performance Yes the discount has been here for ages and I'd have thought that recent performance would have done more to narrow as it hasn't then hard to think that it will in future An activist shareholder might do it

[hamid1970] 31/12/2021 16:26

Does anyone think that the value has been realized already from the current stocks held by the fund. Good hedge on interest rates. However if interest rates rise we will likely have some sort of recession/slow down in 2023. Most of the fund is consumer cyclicals, these are bound to take a hit. Baring in mind the market generally discounts 3 - 6 months ahead. For me its a bit of a head scratcher, is it cheap or not?
PSH has been around 25% below NAV for years. No suggestion that this will change anytime soon

[shareman1111] 31/12/2021 13:47

That was a bad last hour drop !!!!

[bmel] 31/12/2021 09:36

Graham

Cheers. Like yourself I have read the reports and watched Bill on video to try and get into the long grass on this. As I read it when the SPARC hit problems they had to use PSH cash, including a few sales, to meet their obligation to buy UGM so PSH is now fully invested, including a material chunk of UGM. Tontine now hosts the SPAC/SPARC…230;..and the various problems associated along with whatever opportunity emerges.

Personally I think the PSH portfolio is top class and poised for more growth as COVID fades and the USA economy moves back into higher performance. I noticed Domino and
Lowes both hit 52 week highs in recent days. Additionally travel and hotel occupancy rates are close to pre-COVID levels in the USA.

I have held this for over 2 years so am well pleased and I think performance will continue as the portfolio companies performance continues to improve.

As to the discount…̷0;……R30;.as/when it erodes that will be a bonus.

[donald pond] 31/12/2021 09:21

Fair comment. The big unknown with PSH is always the "magic sauce" that changes it from being a high conviction value fund into a hedge fund. After the Herbalife disaster Bill seems to have focussed on identifying quite obscure financial instruments that give very asymmetric returns: the insurance in Feb 2020 and the recent interest rate swaptions. Did he just get lucky? And does his ability to do that merit the fund trading on a 20-25% discount rather than the sort of rating a focussed US value fund would trade at? It seems to me this downside protection should command a premium but clearly the fees make the market wary.

[grahamg8] 31/12/2021 07:32

Good point donald. What I was trying to suggest was that high borrowing gave exaggerated share price movement. This would apply to both growth and value shares. But I do agree that value shares would be expected to move less overall.

bmel you may well ask. Before buying into PSH I thought long and hard about the structure and pretty much gave up. Sure enough PSH has gained from UMG but what is its future commitment to Tontine? How much value is being credited in the PSH books to its interest in Tontine, and will it ever see the light of day?

[bmel] 30/12/2021 09:38

To what extent is PSH, as distinct from PSH Tontine, still exposed to the SPAC/ SPARC?

I understood that PSH used it’s available funds in buying UMG hence our exposure is now minimal.

Any comment appreciated thanks.

[donald pond] 30/12/2021 07:34

Not sure you can fairly criticise it for exposure to value shares AND stellar performance in rising markets. It is arguably that combo that makes it uniqueBut I agree more buybacks and reduced fees would help, as would doing something with the SPAC

[grahamg8] 30/12/2021 07:27

The legal challenge to the SPARC won't help. Nor the hefty fees paid to Ackman. Longer term track record is patchy to say the least. Invested mainly in value shares not growth shares, therefore out of favour. Miniscule dividend. Gearing means stellar performance in a rising market but high risk if a fall occurs. Perhaps the discount is justified after all?

[tania67] 29/12/2021 17:09

The discount has been large for years, despite great NAV growth, buybacks and inclusion in the FTSE100. My guess is that it remains wide because such a large fund cannot rely just on retail investors, but many institutions will be unable to hold it because of its use of derivatives and classification as a hedge fund (even though Ackman’s use of derivatives last year was spectacularly successful). Hence the lack of buyers even at this wide discount.

I am hoping for a January bounce, but am more doubtful about longer-term outperformance without some fundamental restructuring to make it more attractive to institutions.

[shareman1111] 23/12/2021 13:10

Cheers Graham

NAV gap still around 29%

[grahamg8] 23/12/2021 07:21

Close of the day trading. Most shares are US so it is close of the day US except for UMG which is Amsterdam. UK close therefore irrelevant.

[shareman1111] 21/12/2021 15:32

NAV is calculated ‘Close of the day Tuesday’

Is that U.K. or US close of day please guys ?

[lomax99] 17/12/2021 15:37

Had a few more under £30.

[shareman1111] 16/12/2021 11:32

Good entry level John

NAV gap way too high

[johntobin] 15/12/2021 18:23

I agree, I looked at buying after they did so well predicting the effect of covid and hedged. But I thing they are right with their inflation hedge.
I have bought in today and will buy more.

[shareman1111] 12/12/2021 18:07

Great performance and that excludes the inflation hedge !!!!

I’ve noticed retail investors start to Tweet and discuss PSH more on Twitter, I think we’ll see increased buying very soon and the NAV gap will close the more we rise up the FTSE 100