Pershing Square (LSE:PSH) is FTSE100 a mutual fund that is invested in a miniature handful S&P500 stocks. Theoretically, this makes it riskier than the average fund.

However, in practice, manager Bill Ackman has achieved exceptional profits with this high-conviction strategy. Pershing Square has delivered a total shareholder return of 33.9% over the last year.

This is significantly higher than both the S&P 500 (17.9%) and the FTSE 100 (25.7%). Since Ackman restructured the fund, the eight-year annualized return has been 23% compared to 14.3% for the S&P 500 Index.

Pershing Square’s share price has increased nearly 300% since its 2017 IPO.

Putting money to work

As mentioned, Ackman is not a fan of broad diversification. At the beginning of 2026, his five largest positions represented approximately 73% of his total portfolio.

These are global companies with deep moats and sturdy brands like Amazon, Uber, Alphabetand hotel group Hilton worldwide.

It’s clear that given Ackman’s track record, it’s worth being careful about what he buys. And in November he said Pershing was “seeing some very high quality companies coming in at very attractive prices“He was ready to bet.”some money to work“.

I speculated at the time that Ackman might buy Metaplatforms (NASDAQ:META). The billionaire likes to pick up stocks when they lose steam, and Meta has lost 20% since August. Moreover, it was the cheapest action of the Magnificent Seven.

Last week, Pershing revealed that it had indeed purchased Meta stock. It purchased $1.76 billion worth of shares during the fourth quarter, giving the social media giant a significant 11.37% position in the portfolio.

Should I follow Ackman and invest too?

The pressure of superintelligence

Platform Meta needs no introduction. Facebook, Instagram and WhatsApp are woven into the everyday reality of many people around the world. At the end of 2025, this number was 3.58 billion users.

When you operate on this scale, the advertising opportunities are enormous. In the fourth quarter, in-app ad impressions increased by 18% and the average price per ad increased by 6%.

This helped it achieve revenues of $201 billion in 2025, up 22% year-over-year. The operating margin was 41%, which shows how profitable Meta is.

However, given the obvious quality of this business, I have some concerns. First, CEO Mark Zuckerberg is doing everything he can to advance “personal superintelligence for people around the world“.

This means that Meta will spend as much as $135 billion on AI in 2026 – significantly more than the company’s free cash flow last year ($43.6 billion).

As I write this, I think back to 2021/22, when Meta went all-in on the Metaverse, even changing the company name to reflect the move. However, the Reality Labs venture has so far been a money-sucking flop, and I’m concerned that AI may not justify such extreme expenditure.

Another issue is the increasing move by governments to ban social media for under-16s, including likely in the UK. This may cause Facebook and Instagram to lose importance among younger generations.

Deep discounts

Ackman, however, disagrees. He said: “We believe that Meta’s current share price underestimates the company’s long-term AI-driven growth potential and is a deeply undervalued“.

Maybe he’ll turn out to be right, but I don’t buy it. I prefer Pershing Square itself because it is trading at a 23% discount to net asset value.

I think investors who believe in Ackman’s high-conviction strategy should consider the FTSE 100 fund.