Pershing Square CEO Bill Ackman has praised the launch of Trump Accounts as a pivotal policy achievement during President Donald Trump’s second term. In a recent interview with Fortune, Ackman identified the savings accounts for children as among his favorite initiatives, emphasizing their role in broadening market participation. The accounts are designed to invest in low-cost broad market index ETFs, including the SPDR Portfolio S&P 500 ETF (NYSE: SPYM), iShares Core S&P 500 ETF (NYSE: IVV), iShares Core S&P 500 Total U.S. Stock Market ETF (NYSE: ITOT), and Vanguard Total Stock Market ETF (NYSE: VTI).

Ackman stated that he maintains an excellent relationship with the president, attributing this to his candor. While acknowledging that Trump has made mistakes and faces criticism from roughly half the country, Ackman asserted that the president has "generally done a very good job." He specifically commended Trump’s handling of the Iran operation and described the overall performance as "very, very good things," despite political polarization.

The investor argued that widespread stock market participation is critical for sustaining belief in capitalism. "Wages cannot compound as quickly as stocks, so everyone needs to participate in the stock market to believe in capitalism," Ackman said. He criticized those who refuse to utilize Trump Accounts solely due to the president’s name association, calling such behavior "stupid." Ackman noted that millions of parents have already signed up for the program.

Policy Context and Historical Precedent

Ackman revealed that he had proposed a similar concept years earlier, suggesting that babies in America should receive $6,500 at birth, an amount he calculated could compound to $1 million over time. Although he did not pitch this specific plan to Trump, he observed that the current administration has implemented a comparable mechanism through Trump Accounts. This alignment with his long-standing views on wealth creation through equity compounding reinforces his support for the policy.

Broader Market Participation Goals

Beyond Trump Accounts, Ackman emphasized the need for policymakers to address the gap for Americans who do not invest through brokerage or retirement accounts. He pointed to countries like Mexico and Australia, which have advanced their pension systems by making it mandatory for workers to contribute to retirement accounts. "We can do it here," Ackman concluded, advocating for structural changes that ensure broader economic inclusion in financial markets.

What the Numbers Show

The focus on low-cost index ETFs in Trump Accounts reflects a strategic shift toward passive investing for younger demographics. By directing funds into established benchmarks like the S&P 500 via ETFs such as SPYM and IVV, the policy aims to minimize fees while maximizing long-term compounding potential. Ackman’s reference to his previous $6,500 proposal underscores the mathematical premise behind the initiative: early capital deployment is necessary to achieve significant wealth accumulation, such as the $1 million target he cited, given the disparity between wage growth and stock market returns.

Billionaire investor Bill Ackman, the founder of Pershing Square, is betting heavily on tech behemoths Meta Platforms Inc. and Amazon.com Inc., identifying both companies as durable compounders. Ackman argues that despite their massive valuations, these dominant players possess the cash flow predictability and resilience required to anchor a highly concentrated, long-term portfolio. He believes the stocks are currently cheap relative to their unassailable market positions.

Pershing Square focuses on a select few dominant businesses that can survive the test of time and market disruption. Ackman, during an interview with Money News Network, stated that he keeps his investment portfolio famously tight, typically holding only 12 to 15 investments at a time. Rather than chasing the latest artificial intelligence startups or attempting to make money quickly through speculative options trading, his approach centers entirely on predictability and longevity.

"Our approach is to find what we believe to be the best businesses in the world," Ackman explained. "Businesses that will survive the test of time." He noted that Pershing Square targets companies where it can earn a high compound return over the next three, four, or five years. By avoiding what he calls the "new new thing," Ackman has been able to fill his fund with very high quality, durable compounders.

Why Meta and Amazon Are Attractive

For years, Ackman admired companies like Meta, Amazon, and Microsoft Corp., but stayed on the sidelines because they were simply too expensive. Recently, however, that calculus shifted in his favor. "If Microsoft and Amazon and Meta are cheap stocks, which we believe they are, you could argue the market’s not expensive at all," Ackman noted.

When discussing Amazon specifically, Ackman highlighted how deeply embedded the e-commerce giant is in daily consumer life, pointing out its near-monopoly on rapid fulfillment. "I order from Amazon every time I learn about a new book," he said, comparing it to the highly frustrating experience of shopping at locked-down physical stores in New York City. "Meanwhile, you go on Amazon and get it delivered in two hours. And who can compete with that, right? So, think about great dominant business where the probability of competition is extremely low."

Stock Performance

Benzinga’s Edge Stock Rankings indicate that Amazon maintains a weak price trend in the short term but a strong trend in the long and medium terms, with a moderate quality score. Meta maintains a weak price trend in the long term but a strong trend in the short and medium terms, with a solid growth score.