When it comes to hedge fund managers, Bill Ackman is in a class by himself. He etched his name into Wall Street history by going against hedge fund norms, acquiring significant stakes in just a few companies, and holding them for the long term. Furthermore, as a well-known activist investor, those stakes sometimes involve troubled businesses and he pressures management to make changes that positively impact shareholder value.

Ackman heads up Pershing Square Capital Management, the hedge fund he founded, which has more than $11.3 billion in assets under management. Pershing typically holds between eight and 12 large-cap North American companies. To make the cut they must be high quality, have limited downside, and generate predictable, recurring cash flows. This playbook has been extremely successful for Ackman as Pershing Square has returned 31% annualized over the past five years, nearly twice the returns of the S 500.

To close out 2023, Pershing Square held stakes in just eight stocks, but one stands head and shoulders above the rest.

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Source Fool.com