Protégé Partners

🏢 Overview

Protégé Partners is a hedge fund firm that famously entered into a ten-year bet with Warren Buffett. They wagered that a portfolio of five elite hedge funds-of-funds would outperform an unmanaged S&P 500 index fund.

📅 Timeline of Affiliation

2007: The Bet Begins

• Protégé Partners accepted Buffett's challenge to test whether active management could beat passive index investing over a ten-year period, net of fees.

2017: The Bet Concludes

• The bet concluded at the end of 2017 with a massive victory for Buffett and passive investing.
• The S&P 500 index fund achieved an 8.5% average annual gain.
• The five funds-of-funds selected by Protégé averaged gains between 0.3% and 6.5%.
• Buffett used the conclusion of the bet to illustrate the devastating impact of high fees ("Performance comes, performance goes. Fees never falter.").
• Source: 2017 Letter

🔗 Links

• Entities: Warren Buffett
• Concepts: The Bet, Index Funds
• Sources: 2017 Letter