Buffett's Bet

This is awesome. One key point is that the bet is on fund of funds so the fees collected is alot higher than just a hedge fund. Not only do you get the 2% of assets and 20% of profits charged by most hedge funds but then you get an additional 5% of profits plus charged by the funds of funds.

http://money.cnn.com/2008/06/04/news/newsmakers/buffett_bet.fortune/index.htm?section=money_latest

Will a collection of hedge funds, carefully selected by experts, return more to investors over the next 10 years than the S&P 500?

That question is now the subject of a bet between Warren Buffett, the CEO of Berkshire Hathaway, and Protégé Partners LLC, a New York City money management firm that runs funds of hedge funds - in other words, a firm whose existence rests on its ability to put its clients' money into the best hedge funds and keep it out of the underperformers.

and

And maybe they will. Buffett himself assesses his chances of winning at only 60%, which he grants is less of an edge than he usually likes to have.

Protégé figures its own probabilities of winning at a heady 85%.