Tuesday, 31 March 2015
Last updated 1 hour ago
May 7 2007 | 9:21am ET
One of the greatest investors in history is warning that hedge funds are no silver bullet.
Warren Buffett, at a press conference following the annual meeting of his Berkshire Hathaway in Omaha, Neb., cautioned that investing in hedge funds is no way to guarantee strong returns, because their returns are misleading.
“The gross performance may be reasonably decent, but the fees will eat up a significant percentage of the returns,” he said. “You’ll pay lots of fees to people who do well, and lots of fees to people who do not do so well.”
Buffett noted that Fidelity Investments’ Magellan fund, once the largest mutual fund in the world and one of the best performing, fell on hard times when it got too big. Some have blamed the mediocre hedge fund returns of the past several years on too much money chasing a limited number of opportunities.
“If you take something like Fidelity Magellan, which Peter Lynch ran terrifically, a lot of the results were achieved with smaller amounts,” he said.
What should investors do? Buffett went to bat for index funds.
“A very low-cost index is going to beat a majority of the amateur-managed money or professionally-managed money,” he said.
Mar 9 2015 | 6:35am ET
As more investors look to diversify, many are beginning to use retirement funds to invest in alternative assets such as private equity and real estate. Kelly Rodriques, CEO & President of PENSCO Trust Company, explains how companies can connect with those looking to use their retirement accounts in a different way. Read more…
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…