Yep really important point for investors outside the USA, one that is overlooked by almost everyone managing their own money here in the UK. Due to the reasons you mention it is a lot easier for a good active fund to outperform and beat a comparative index over time here. I still would prefer to use a passive fund for access to specifically the S&P/large cap USA however. There are also still sadly a shed load of expensive, underperforming active funds.

It's just really hard to outperform while charging 2/20. Renaissance can do it because they are a market maker, but you can't get into Renaissance. You have to pick from open funds, and very few investors are equipped to pick skilled from unskilled, when the skilled is likely only 5% of the market.

Go back as far as you want, hedge funds are dead losers overall vs the market.

Doesn't mean there isn't a case to be made for an allocation to uncorrelated funds in a balanced portfolio.

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Sure, bond funds. Hopefully ones without 2/20 structures.

This can't be emphasized enough. A friend of mine applied the 2 & 20 structure to historical market returns from 1928 to present. The annualized returns to the 2 & 20 structure were 5.2% vs 9.6% for the market, which gives you an implied fee of 4.4% per annum. Good luck beating that sort of rake!

Groucho Marx said it best, "I refuse to join any club that will have me as a member."

It’s officially over.

http://fortune.com/2017/12/30/warren...on-dollar-bet/

The bet was pretty much decided years ago barring some crazy market events. Anyone have any links to more details about the exact returns that each had? Were the identities of the funds used ever released?

They should run it back for another 10 years!

The exact fund identities were kept private. You can find information about the returns of each fund of funds in the 2016 BRK annual report. WEB's comments about the bet run from page 21-25.

http://www.berkshirehathaway.com/2016ar/2016ar.pdf

Ted Seides has also written an article or two about the bet, along with discussing it on several podcasts. Google around a bit and you will find the interviews/articles.

I'd seen the stuff from the 2016 annual report. Was fun to read it again.
Guess nothing really changed in the past year to expect any major update.

The article from Ted Seides was predictable excuse making from a guy who wants to continue to rake massive fees while providing his clients with negative value.

https://www.bloomberg.com/view/artic...warren-buffett

As I said years ago, I don't think this will make a big change in the way people invest. The idea that you need an insider helping you to make money investing is very ingrained in the collective psyche in America. And with the money these companies rake, they can spend that money on marketing to make sure that this belief continues, even if facts don't back it up.