Pershing Square IPO Plummets 18% on Day One—Ackman Blames Retail Investor Ignorance
Pershing Square USA (PSUS) closed its NYSE debut at $40.90, down 18% from the $50 IPO price. The closed-end fund's NAV discount risk materialized immediately. Ackman attributed the selloff to retail investors' lack of IPO sophistication.
- Pershing Square USA fell 18% on IPO day to $40.90, with closed-end fund NAV discount risk materializing immediately
- Parent PSH trades 27% below NAV, a structural challenge typical of closed-end funds
PSUS IPO price $50 → closes at $40.90, rebounds modestly to $42.71 next day… NAV discount concerns realized on day one
Bill Ackman's Pershing Square USA (PSUS) closed its NYSE debut on April 29 at $40.90, down 18% from the $50 IPO price. The stock also undercut the pre-launch trading range of $42.50–$47.50. The closed-end fund NAV discount risk flagged in our pre-IPO coverage materialized on day one.
On April 30, PSUS rebounded over 4% to $42.71 but remains below the IPO price. The parent company Pershing Square Inc. (PS) closed its first day at $24.20, then surged 15% to $28.00 on day two.
'Retail Investors Don't Know How to Buy IPOs'
On an April 30 investor call, Ackman blamed the day-one selloff on retail investor behavior, stating: 'Retail investors don't know how to buy IPOs.' Ironically, PSUS's core marketing pitch centered on accessibility: 'Hedge funds were once exclusive to the wealthy, but now you can become a long-term shareholder for $50.'
Closed-End Fund Structure Is the Root Issue
The structural cause of the day-one decline is the closed-end fund format. Unlike conventional ETFs or mutual funds, closed-end funds have a fixed share count and trade on exchanges. This creates discounts or premiums as share price diverges from net asset value (NAV).
The Pershing Square Holdings (PSH) European listing trades at approximately 27% discount to NAV—a risk flagged before the IPO. Market participants immediately priced a similar discount into PSUS on day one, reflecting the identical structural dynamics.
Portfolio Quality Remains Solid
Separate from the stock's weakness, the portfolio itself is robust. Per Q4 2025 Form 13F holdings: Brookfield (BN) 18.15%, Uber (UBER) 15.90%, Amazon (AMZN) 14.28%, Alphabet (GOOG) 12.46%, Meta (META) 11.37%, Restaurant Brands (QSR) 10.05%, Howard Hughes (HHH) 9.69%, Hilton (HLT) 5.60%. In Q4, the fund added 2.67M Meta shares and 3.78M Amazon shares while trimming Alphabet.
The 20 PS shares per 100 PSUS shares bonus granted to IPO participants at $50 does not apply to secondary market buyers.
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