Tuesday, January 02, 2018

Warren Buffett Wins $1 Million Bet Against Hedge Funds

With 2017 over, Warren Buffett has sealed his victory over hedge funds in a bet he made a decade ago. The Berkshire Hathaway chairman in 2007 bet $1 million that the S&P 500 would outperform a selection of hedge funds over 10 years. As of Friday, his S&P 500 index fund had compounded a 7.1% annual gain over that period. The basket of funds selected by Protégé Partners, the managers with whom he made the bet, had gained 2.1%, according to The Wall Street Journal. Buffett agreed to give the prize money to Girls Inc. of Omaha, Nebraska, a nonprofit he has previously supported. ... Buffett has long taken issue with hedge funds' promise of outperforming the market and their high fees that take away from the returns their clients earn. He has turned out to be right on both fronts.


Old as the hill news. What's most surprising is that a zero coupon treasury out performed both!

#1 | Posted by DavetheWave at 2018-01-02 07:18 PM


You know what did even better in that time?


#2 | Posted by rstybeach11 at 2018-01-02 11:13 PM

Old as the hill news.

2 days is hardly over the hill news.

#3 | Posted by REDIAL at 2018-01-03 06:42 AM


The important point here is that the hedge fund operators outperform the DOW substantially for themselves, while underperforming the DOW for their investors. This is a universal problem with almost all advisers. This problem is mitigated for those people who are already filthy rich and consistently get better investment advise. Trump has made the problem much worse by making it legal, once again, for brokers to fail to put their clients best interests before their own. Dave hates regulations like that. Big dogs eating little dogs is better.

#4 | Posted by bayviking at 2018-01-03 08:19 AM

"Trump has made the problem much worse by making it legal, once again, for brokers to fail to put their clients best interests before their own."

I had to pull this out. Very true.

#5 | Posted by BruceBanner at 2018-01-03 08:38 AM

4 you are an idiot with no idea wtf you are typing.

Earth to troll, I'm on record hating hedge funds AND being a 'long' investor in US equities. SINCE I JOINED THIS group.

Stupid nimrods like you don't even understand the fiduciary rule. But let me ask you, since you pretend to know so much about what brokers do.

1. Which account "costs" more, a fee based account or a commission based account?

2. Should a fiduciary prevent an investor from doing a trade that appears to not be in their best interest? DOES THAT STANDARD APPLY TO ETRADE/FIDELITY /SCHWABB. If not why not??

#6 | Posted by DavetheWave at 2018-01-04 11:44 AM

I guess ol' Warren will take his winnings out of his pocket, dump it in an old pickle jar in the corner of bedroom and forget about it.

#7 | Posted by shane at 2018-01-04 02:54 PM

7 Or perhaps he will use them to pay for those Wells fargo fines/law suits.

His stock ownership of WFC, which is the center of the worst consumer scam since the debt crisis, goes unmentioned.But he's loved here, so all is forgiven!!

#8 | Posted by DavetheWave at 2018-01-04 05:32 PM

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