Warren Buffett Bets $320K That Management Fees Are Crap

NYT:

Warren Buffett, a longtime critic of the fees charged by some money managers, has put his own cash on the line -- or, at least, a small chunk of it -- in an attempt to prove his point.

Fortune.com reports that Mr. Buffett, the legendary value investor who runs Berkshire Hathaway, has entered into a bet with a firm that runs funds of hedge funds over whether or not funds handpicked by experts can beat the S&P 500 index over 10 years.

There is about $640,000 in the kitty, Fortune.com said, half put up by Mr. Buffett and half put up by Protege Partners, the fund-of-hedge-fund manager on the other side of the wager. At the end of the 10 years, the pool is expected to be worth about $1 million, which will go to a charity of the winner's choice.

Read the whole story: NYT

Comments

[Myshkin57]

I can't wait until Buffet wins. I want all those hedge fund leeches to be out of business. They add nothing to the world and pay less in taxes (by percentage) than people who do. Let's stop this welfare for people with no valuable skills!!!

[drkazmd65]

Anybody that bets against Buffett when it regards stocks and long term investment is a fool.

I mean,.. the man has made billions,... and amazingly enough has done it without playing short-term higher risk games.

[kellygrrrl]

agree!

I hope the Obama Administration is open to his help.

[dadw5boys]

I like Buffets style.
He is the Bruce Lee of Investors.

Bruce Lee taught in Kung Fu you expand when your oppoent contracts and you contrat when he expands.

Just like Buffet invests.

People running for cover he is buying compnays cheap. People start buying companys works on the companys he owns till it turns again the he buys again.

Great Man.

[DRaymond]

It is an easy deal. Lots of folks can outgun the stock market for a short time, even just random variation will do that. And then having a lucky start you can play just ordinary market gains into long term gains that appear to be beyond market performance because essentially you started with more. But for someone entering later? Good fortune has to strike twice. Because you are playing in the same market as everybody else. So you think that a given stock should be trading at thiryt instead of twenty? BFD, everybody else is going to be trading at twenty.

[totalliberal]

He knows the spoiled little trust fund supported, money manger puppies are all full of sh*t. The only way they can make money is through family connections. Kind of like the little loser in the WH.

[dadw5boys]

Don't forget the little loser in the White House got several SBA Loans and he went bankrupt on each one.

But paid his self a $200,000.00 a year salary all the time.

[ErnestineBass]

Of all the big money men, Buffet is the only one to put any where his mouth is.

I can't help but like him.

[heal57]

I like Warren Buffet also. Despite his mega millions, he is not an elitist. He will probably win that bet. The S&P500 does better than about 90% of managed funds; at least I think it's about that percentage.