By Svea Herbst-Bayliss
BOSTON (Reuters) - Billionaire hedge fund investor William Ackman said on Thursday that he expects to see market gains next year but warned there could be volatility in the months ahead as the coronavirus continues to take its toll.
Ackman told investors that he's "happy to be long" on equity exposure and is "bullish" on 2021 at a time of low interest rates, more expected stimulus and infrastructure spending.
But he also warned that dark days lie ahead as the United States passed a milestone with 250,000 coronavirus deaths. While he is generally optimistic, the investor said it is "prudent" to insure his portfolio now amid a range of uncertainties that can lead to market volatility.
Ackman put on a new hedge -- roughly one third the size of the one he put on earlier this year -- as corporate credit spreads are very tight. On a conference call with investors he said he likes the companies he's invested in now and expects Lowe's (N:LOW), Starbucks (O:SBUX), Hilton Worldwide Holdings (N:HLT) and Chipotle (N:CMG) to perform well after an end to the pandemic.
Pershing Square Capital Management, Ackman's $12.5 billion firm, boasts one of the industry's best records this year with a return of roughly 55%. Ackman said it is the 16-year old firm's best year ever on a gross basis.
He said that he has agreed to hire a woman to his all-male investment team but declined to name her, saying only that she performed extremely well on the tests he gives to candidates and is expected to join late next year.
He also declined to offer any new details about his blank check company Tontine, short of saying that the extensive shareholder list will be an asset in finding a target. [L1N2I305K]