Round I, Buffett vs. hedge funds

For all the 2008-generated angst in the hedge fund industry, the fact remains that the average hedge fund fared much better than the average mutual fund. This was driven home by the much-publicized bet that Warren Buffett made. He wagered an S&P 500 fund would outperform a fund of five hedge funds over five years.

Well, the audited results are in for the first year. As you might expect, the hedge funds are winning hands down. Fortune notes Vanguard's S&P 500 Admiral shares, the index fund "bought" by Buffett, fell 37 percent while the average fall (net of all fees, costs, and expenses) of the five funds-of-funds backed by Buffett's opponent, Protégé Partners was just 24 percent. One issue here is that we don't know which five funds were chosen, but perhaps it represents a bit of fund-picking skill. Buffett has a lot of time yet. 

For more:
- here's the article

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