Investing.com — Billionaire Bill Ackman blamed retail investors for the 18% decline in his newly listed closed-end fund on Wednesday, saying he expects the shares to recover.
According to a Reuters report, Ackman told foreign journalists on Thursday that retail investors don’t know how to invest in IPOs, one day after listing the new stock-picking fund and his management company on the New York Stock Exchange.
The investor marketed the U.S. stock market listing as an opportunity for retail investors to access investments typically available only to the ultrawealthy, though his fund has underperformed the broad stock market in recent years.
Ackman said his closed-end fund has returned an average of 25% annually over the past eight years, outperforming other funds.
He said retail investors overcommitted to the IPO, received the shares they requested but lacked the cash to pay for them, forcing them to sell.
was priced at $50 but shares fell to $40.90 on Wednesday. The stock traded up more than 6% on Thursday at $43.54, remaining below the IPO price.
“We had a whole bunch of people dump that stock yesterday for technical reasons,” Ackman said.
Institutional investors made up more than 80% of the capital raised, raising questions about how retail investors could be responsible for Wednesday’s decline.
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