Bill Ackman made a big bet on himself even as some investors were second-guessing the future of his hedge fund, Pershing Square Capital Management. So far, it’s paying off.

The billionaire plowed about $500 million into the publicly traded arm of his fund last year, arguing it was significantly undervalued. At the time, Pershing Square Holdings Ltd. was trading at roughly $15 a share.

The fund has returned 54.5% on its investments this year through August, fueling a 47% gain for shares of Pershing Square Holdings, which closed in Amsterdam Thursday at $19.02, the highest since January 2016. That translates into a $198 million gain for Ackman in 2019 on his half-billion-dollar bet, data compiled by Bloomberg show.

That’s quite a reversal of fortune. Early last year, Ackman told investors he had to change course after a disastrous bet on Valeant Pharmaceuticals Ltd. and an ill-fated short-selling campaign against Herbalife Nutrition Ltd. Pershing Square was seeking to snap a three-year losing streak, and investors had pulled billions of dollars from Ackman’s private funds.

“There was doubt as to whether Bill Ackman would be able to survive,” said Kai Liekefett, partner and chairman of the shareholder activism practice at law firm Sidley Austin LLP. “It looks like he has been focused on the last year or two on fundamental investing. He’s abstained from campaigning and started to find his groove again.”

Ackman, 53, is worth $1.8 billion, according to the Bloomberg Billionaires Index. He declined to comment.

Pershing Square has rallied along with some of its biggest holdings, including Chipotle Mexican Grill Inc., Starbucks Corp., Burger King owner Restaurant Brands International Inc. as well as mortgage finance companies Fannie Mae and Freddie Mac. In June, he booked a 64% profit on an investment in Automatic Data Processing Inc., about two years after acquiring a stake in the company.

It had been a brutal stretch for Pershing Square investors, who had seen nothing but losses over the past several years. The fund tumbled in 2015 and again in 2016, driven in large part by Ackman’s bet on Valeant, an investment that cost investors more than $4 billion. Ackman also waged a prolonged short-selling battle against Herbalife, a losing billion-dollar bet that brought him into a public conflict with Carl Icahn, who eventually became the company’s biggest shareholder.

Ackman was poised for a rebound last year, but a pre-Christmas market collapse wiped out an 11% gain and the fund ended the year down 0.7%.

One reason Ackman cited for investing in his fund was a persistent discount between Pershing Square’s share price and its net asset value, or NAV. The discount was about 25% in May 2018, when he announced that he would start buying shares. Despite the fund’s recent gains, the discount to NAV has widened to almost 30%, and Pershing Square has said it plans to take advantage by continuing to repurchase stock.

It’s “an extraordinary buying opportunity, and we have ample free cash,” Ackman said in a letter to shareholders last month.

Pershing Square Holdings’ performance this year could prove lucrative for Ackman in other ways. Last week, the fund’s NAV climbed high enough that, if the gains hold through the end of the year, he’ll be able to collect performance fees for the first time since 2014.

In a March letter, Ackman attributed the year’s strong start to a number of factors. The nature of his publicly traded fund meant he no longer had to focus on raising money, and the smaller, more focused investment team was paying dividends. He has also turned away from short-selling strategies, which previously weighed on performance.

In January, Ackman married Neri Oxman, a professor at the Massachusetts Institute of Technology. The former Israeli Air Force lieutenant gave birth to their daughter in the spring. At an investor conference in April, Ackman gave another possible reason for his recent success: “Maybe it has something to do with being loved and getting married?”