Manuel Balce Ceneta/AP

Pershing Square Holdings, the activist hedge fund run by the billionaire Bill Ackman, returned 58.1% in 2019, the fund said in December.

It was the first net positive annual performance for Ackman's fund in three years.

Ackman increased his position in Warren Buffett's Berkshire Hathaway this year, according to Securities and Exchange Commission filings. In April, he said the fund's outperformance was due to Buffett's influence, Yahoo Finance reported.

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After three years of net negative returns, Bill Ackman's hedge fund posted an incredible rebound in 2019.

Pershing Square Holdings, the activist fund run by Ackman, gained 4.5% in December, bringing its 2019 net performance to 58.1%, it said in its December portfolio update. It was a massive outperformance of the S&P 500, which gained 29% last year.

The positive annual performance was the first for Pershing Square since the fund began trading publicly in 2014, when it returned 40.4%. From 2015 to 2018, the fund posted negative returns; in 2018 it nearly posted a positive return, but fees pulled it down to -0.7% from 0.07% for the year.

Since then, Ackman has honed his long positions and exited chemical and business service companies. In 2019, he also bet big on Warren Buffett, the so-called Oracle of Omaha who leads Berkshire Hathaway. At the end of September, Ackman held roughly 4 million Berkshire Hathaway B shares worth about $555 million, according to GuruFocus data.

In August, Ackman told investors the position in Berkshire Hathaway amounted to roughly 11% of Pershing Square's net asset value. Since Ackman announced the investment, Berkshire Hathaway shares have gained roughly 16%.

At 13D Monitor's Active-Passive Investor Summit in April, Ackman — who considers Buffett a mentor — said the fund's performance, which was already in the double digits, was due to Buffett's influence, according to Yahoo Finance.

In addition to Berkshire Hathaway, Pershing Square's investments include Starbucks, Lowe's, Chipotle, and Restaurant Brands International, the parent company of fast-food joints such as Burger King and Popeyes, according to September data.

In December, Pershing Square also announced a stake in Agilent Technologies, which makes life-sciences equipment, Bloomberg reported.

Pershing Square's outperformance came during a rough year for hedge funds overall. In 2019, the hedge-fund industry saw more closures than openings for the fifth year in a row, spurred by investors looking for cheaper vehicles to capture the bull market's record run.

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