Bill Ackman runs Pershing Square Capital Management. He is perhaps best known for a disastrous short position in , a nutrition company he called a pyramid scheme. Ackman made a $1 billion bet against Herbalife in 2012, expecting the stock to go to zero, but it had doubled by the time he exited the position in 2018.

However, Ackman has made some excellent moves in the market as well. Indeed, his hedge fund returned 288% over the past five years, easily topping the S 500's 107% gain. That outperformance makes Ackman an investor worth studying.

With that in mind, 34% of his Pershing Square portfolio was invested in two companies as of the quarter ended last September: 17% was allocated to Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG), and another 17% was invested in Chipotle Mexican Grill (NYSE: CMG). Ackman is clearly signaling high conviction in these businesses.

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Source Fool.com