market folly

Bill Ackman's hedge fund Pershing Square Capital Management has filed an amended 13D with the SEC regarding their position in Howard Hughes (HHC).  Per the filing, Pershing has disclosed a 26.2% ownership stake in HHC via aggregate economic exposure of 10.88 million shares.

The main takeaway here is their swaps exposure to the name. They own 3.56 million common shares, Series A-2 warrants to purchase an additional 1.9 million shares, as well as 5.39 million shares of notional exposure via cash-settled total return swaps.  All of this exposure adds up to their 26.2% stake.

Per Google Finance, Howard Hughes is "a developer and operator of master planned communities and mixed use properties. The Company operates three segments: master planned communities, operating assets and strategic developments. The Company specializes in the development of master planned communities and ownership, management and the redevelopment or repositioning of real estate assets generating revenues, also called operating assets, as well as other strategic real estate opportunities in the form of entitled and unentitled land and other development rights, also called strategic developments."

For more on this hedge fund manager, head to Bill Ackman's latest presentation on Herbalife.