June 22, 2020 / 8:51 PM / 13 days ago

Ackman sees economy beginning to recover in 2020, true confidence will take time

BOSTON (Reuters) - Billionaire investor William Ackman, whose hedge fund survived a historic stock market sell-off with double-digit gains, said it will take until the middle of 2021, at least, for the economy to shake off the worst effects of the coronavirus outbreak.

“We will begin recovery by year-end,” Ackman said at the Bloomberg Invest Global Conference on Monday, but said the economy won’t return to anywhere near normal before the middle of 2021. “Confidence won’t return until people feel truly safe,” he said, adding that a vaccine for the virus, which has killed roughly 120,000 people in the United States, would make an enormous difference.

Ackman’s roughly $10.7 billion Pershing Square Capital Management has returned about 30% since January thanks in part to a $27 million hedge that paid off into a $2.6 billion windfall that has been reinvested in stocks since mid-March.

As an activist investor, Ackman earns his living by suggesting how management should perform better, but on Monday he sidestepped questions about the management of the U.S. economy or which presidential candidate is better suited to lead. “Who the president is is not something we make bets on,” he said, adding that the election’s outcome won’t shape his portfolio.

With this year’s gains, Ackman has put a few rocky years into the distant past and vowed to never again take his eye off the investing roadmap. “At 54 I’m done making mistakes,” he said. “We will be watchful of veering from the course.”

Known as a passionate tennis player, Ackman said another sport — rowing — helped shape his sense of grit and perseverance. Recalling the four years he spent grinding out miles on the Charles River as a member of Harvard’s crew team, Ackman said rowing helped him learn how to “endure large amounts of pain.”

Reporting by Svea Herbst-Bayliss; Editing by Leslie Adler and Alistair Bell

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