Saturday, August 6, 2016

So which position will Mr Ackman exit: Herbalife or Valeant

Bill Ackman just exited his large position in Canadian Pacific.

This was a stunningly successful position: genuinely I wish I had done it.

It also produces a very large taxable gain.

Mr Ackman however has been producing less-than-stellar performance for his Pershing Square fund.

So at the moment he is leaving his clients with large losses plus a large tax bill. I can't imagine they would be thrilled with that.

Logically then Bill Ackman will wipe his taxable gain by reducing or exiting one of his large losing positions - either the short on Herbalife or the long on Valeant.

I really don't have any insight into which - but he is on the board of Valeant and that makes moving the Valeant position more problematic.

Thoughts anyone?




John

PS. This observation is not original. I received similar from at least three separate emails.

General disclaimer

The content contained in this blog represents the opinions of Mr. Hempton. Mr. Hempton may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Hempton's recommendations. The commentary in this blog in no way constitutes a solicitation of business or investment advice. In fact, it should not be relied upon in making investment decisions, ever. It is intended solely for the entertainment of the reader, and the author.  In particular this blog is not directed for investment purposes at US Persons.