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Friday 11 August 2017

Buffet against hedge funds - 9 years later

Nine years ago, Warren Buffett agreed to make a bet called "one million dollar bet". In it, the billionaire will be betting with his opponents from the $3.5 billion Protege Partners hedge fund to beat their sophisticated investment schemes and active selection of companies with a simple investment in a S&P 500 index fund (Vanguard S&P 500).
It was a long time ago - almost nine years ago, and to the end of the bet remain about six months, given that it ends on December 31 this year.
How are things to date?
Buffett leads, with lots. It must be a real miracle to lose the bet. After nine years, the hedge fund portfolio rose by 22 percent, while the Vanguard Admiral Shares S&P 500 Index Fund added 85.4 percent to its value. That is almost four times more.
The yield on the index fund was higher than that of the hedge fund in seven of the past nine years.

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