Winners and Losers

By Matthew Gutierrez and Shawn O'Malley · July 1, 2024

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The second half of the year is underway. Somehow, it’s already the start of the third quarter after a very strong first six months in 2024.

Here’s a quick recap of the gains year-to-date:

• S&P 500: ~15%
• Nasdaq: ~18%
• Gold: ~13%
• Bitcoin: ~48%

And since it’s a new month, it’s worth noting that July is the best month of the year for the S&P 500, both since its inception and over the past 20 years.

— Matthew & Shawn

Here’s today’s rundown:

Today, we'll discuss the biggest stories in markets:

• Bill Ackman’s Pershing Square sets IPO price
• The AI trade: a deeper look

This, and more, in just 5 minutes to read.

POP QUIZ

The Magnificent Seven tech stocks, including Nvidia, are responsible for what percentage of the S&P 500's total return this year? (Scroll to the bottom to find out)

Chart(s) of the Day

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In The News

?? Bill Ackman’s Pershing Square to Offer Shares at $50

Billionaire investor Bill Ackman's Pershing Square has announced plans to launch a new closed-end fund in the U.S., setting the initial public offering price at $50 per share.?

The fund is slated to become the largest closed-end fund in the country. Its ambitions aren’t small: It wants to raise $25 billion from retail investors.

• A closed-end fund raises capital for investment through a one-time sale of a limited number of shares, which may then be traded in the secondary market.
• The new vehicle will mirror Ackman's existing Europe-listed hedge fund but with reduced fees and quicker access to capital. It will focus on investing in 12 to 15 undervalued, large North American companies.

Fee game: Pershing Square USA will implement a flat 2% management fee, which will be waived for the first 12 months, and notably, there will be no incentive fee. This fee structure is designed to be more attractive than typical hedge fund fees, which could draw in a broader range of investors.

• The fund's shares will be listed on the New York Stock Exchange in 2025 or 2026 under the ticker symbol "PSUS.” While the number of shares offered remains undisclosed, interested investors must purchase at least 100 common shares ($5,000-plus) to participate in the offering.

Premium fund: Ackman's existing European vehicle has demonstrated quite good performance, returning 50.3% over the past year and outpacing most of its U.S. peers. But it’s trading at a 25% discount to its net asset value, a gap the new U.S. fund might aim to narrow.

• “With lower required costs than his typical hedge fund fees and social media popularity, the US-listed Pershing Square USA Ltd. could become the largest closed-end fund in the country and trade at a premium to its net asset value,” Bloomberg analysts wrote.?

Prominent financial institutions, including Citigroup Global Markets, UBS Securities, Bank of America Securities, and Jefferies, are underwriting the IPO. The move follows Pershing Square’s recent $1.05 billion fundraising by selling a 10% stake, valuing the firm at about $10 billion.

Why it matters:

With Ackman's social media popularity and the fund's attractive fee structure, analysts suggest...