Bill Ackman's strange new security — that's expected to begin trading this month — explained

Bill Ackman, founder and CEO of Pershing Square Capital Management.
Adam Jeffery | CNBC

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Bill Ackman's Pershing Square Tontine Holdings is set to become the largest special purpose acquisition company, or SPAC, in history when it begins trading this month, according to data from SPACInsider. 

The fund, announced in June, was initially targeting $3 billion in outside capital. On Monday, a new filing with the Securities and Exchange Commission showed the target had been raised to $4 billion. Ackman's hedge fund, Pershing Square Capital, will invest an additional $1 billion to $3 billion, meaning the vehicle's total value could reach $7 billion.

Here's a look at the unique structure of Ackman's new fund and more on SPACs, which are on track for a record year.