Seides Rationalizes The Bet He’s Losing To Buffett

Seven years ago, Protégé Partners Co-CIO Ted Seides took a $1 million bet with Warren Buffett over whether the average performance of five funds of hedge funds could beat the S&P 500 net of fees over a ten year period (the winner gets to choose which charity gets the money). The funds of hedge funds are getting crushed, but Seides draws on the value investing lingo that Buffett helped make famous for a tour de force rationalization.

“Just as stock picks sometimes head in the wrong direction upon purchase and call into question whether a thesis is early or wrong, so too has hedge fund underperformance over the last seven years raised the question of whether hedge funds are bent...