Pershing Square December 2010 Returns from a Fake Investor Letter

Pershing Square doesn’t stop amazing investors with their unbelievable monthly returns. Pershing Square returned 2400% gross and 7% net returns in December 2010. Insider Monkey, your source for fake hedge fund investor letters, posted the image of Pershing Square’s latest newsletter below. You can see the document has Pershing Square’s original 100% authentic letterhead, so everything written on the document must be true.

Bill Ackman in front of Perishi

Insider Monkey telepathically contacted Pershing Square to verify the authenticity of the document. Here is the totally fabricated telepathic interview we had with Pershing Square:

InsiderMonkey: First thing’s first. Did you send the November investor letter directly to Dealbreaker?

Pershing Square: Are you crazy? We aren’t allowed to advertise our services to the general public. There is no way that Pershing Square directly provides confidential investor letters to sites such as Dealbreaker, no matter how much we love Bess Levin and her witty articles.

Insider Monkey: We were under the impression that you want to publicize your returns, especially when they’re amazing. How about the fake December 2010 investment letter Insider Monkey posted on their website- is it authentic?

Pershing Square: What kind of Monkey business are you running? It is out of question that we provide fake investor letters to Insider Monkey, the Onion, or the Daily Show with Jon Stewart.

Insider Monkey: But Bill Ackman is a very transparent hedge fund manager. Maybe the most transparent one.

Pershing Square: Yes, Bill Ackman is a very transparent hedge fund manager. He even swam naked in the toxic waters of Istanbul (I mean Constan-pol —> Constanbol —> Istanbol), but he learned his lesson after applying topical fungus medication twice a day for four weeks. Twice. Skin problems came back after a year. He’s very transparent but he won’t distribute his returns publicly no matter how good they are and how embarrassing they are for David Einhorn (Guess who didn’t have a 35% return in 2010).

Insider Monkey: So, you’re saying that you don’t officially send investor letters to the media and Dealbreaker might have been duped. Right?

Pershing Square: It’s technically possible that someone might dupe Dealbreaker. You should direct this question to Dealbreaker, we don’t know who their source is.

Insider Monkey: What can you say about the authenticity of the fake Pershing Square December investor letter?

Pershing Square: We are certain that the fund letter Insider Monkey provided is fake for the following reasons:

1. The date on the letter is December 32, 2010. Apparently Insider Monkey never heard of Forms 4, 13D, 13G and calendars. December has only 31 days.

2. There’s a huge difference between gross and net returns, we only charge an arm and a leg according to Warren Buffett (see Warren Buffett‘s stock picks). If we had 2400% gross return, our fees would be slightly under 500%, not 2393%.

Insider Monkey: Yes, but the letter is published with your 100% authentic letterhead. So the letter must be authentic, right?

Pershing Square: You can’t be this naive. Have you ever heard of Photoshop? The letterhead is fake. We don’t have a monkey hanging in our logo.

Insider Monkey: But the letter also had the “Bess Levin” watermarks all over the letter-  this definitely proves that it is authentic.

Pershing Square: This is enough. We’re ending this interview here. {mutters to self, ” this monkey is an idiot”}

Insider Monkey: Wait, one last question. What is a Form 4? We only care about Form 13F’s, and ignore all the other forms hedge funds file.

Pershing Square: We can see that. Form 4 is used to report presumably legal insider transactions. You should look into it, you wouldn’t believe what insiders reveal in those filings.

Insider Monkey: Thanks for letting us know that. We had no idea. We have another final question- like the Movie Final Destination 2: does Pershing Square have any secrets that you don’t reveal to the public?

Pershing Square: Yes, we do. We try not to reveal any information that would jeopardize our returns, negotiation power with our counterparties, etc. Hedge funds are secretive if you haven’t noticed; they always hide something.

Insider Monkey: Thank you for your honesty. Another final question, like the Movie Final Destination 3: can we have your monthly returns so that we can calculate your alpha?

Pershing Square: No. It’s not legal. We can’t advertise to the general public. Try to be friends with Bess. Maybe she’ll share her sources with you.

Last Friday Insider Monkey published an article pointing to the fact that there’s a huge discrepancy between Pershing Square’s holdings reported on their latest 13Fs and their November returns. Nearly 90% of their 13F portfolio returned 1.7% and their remaining 10% position in GGP was not enough to bring their return up to 15%. So we published an article titled “Is Pershing Square Hiding Something or Was Dealbreaker Duped?” Of course, Pershing Square was hiding something- there’s no such thing as a 100% transparent hedge fund. See why Pershing Square’s 15% November return doesn’t make sense.

Insider Monkey will be providing more information about hedge funds in the coming months. We’ll explore their transactions, whether they have any alpha, why they made a certain transaction, etc. All of our articles are free. But most importantly, Insider Monkey developed a proprietary algorithm that determines which hedge fund transactions have a higher likelihood of being profitable. That’s the real value-added service. We will be following around 100 hedge funds and will publish the top 25 stocks.

Insiders and hedge fund managers manage to beat the market. Insider Monkey will try to help you understand what these insiders are trying to do. After all, we are the smartest monkey on Wall Street.