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11 | O akville B eaver | T hursday,N ovem ber 7,2019 insidehalton.com Fixing Furnaces Since 1932 Call 289-205-3443 • Heating and Cooling • Plumbing • Sewer and Drains •Water Heaters • Service Plans 20 19 Fastest Emergency Service in Oakville delmanor.com Across the GTA, at every Delmanor residence, we're constantly reminded of the contribution our residents made to building and protecting this country. They sacrificed to make our lives better. It's our responsibility to make theirs easier. Join us this month in saluting our veterans, past, present and future. Be ever grateful for your freedom and those that served to protect it. We are, every day. They proudly served Canada. We're proud to serve them. Delmanor Resident and Veteran (905) 469-3232 1459 Nottinghill Gate, Oakville Ying Yang Chartered Professional Accountant Member of Canadian Tax Foundation (647) 989-1276 Oakville Office: (289) 291-3924 Toronto Offiffice: (647) 255-8049 yy@yangaccounting.ca For an affordable solution to your Business and Individual tax difficulties … Make an Appointment Today for a Free Confidential Consultation CRACRACRACRA PPPPrroblobleems?ms? Individual, Corporati &on & Trust Payrayroll, HST includiudingng Overseas & O& Offffshorshore Tax Issueax Issues Yang Tang Tang Tang ax Resolsolution Warren Buffet did notWarren Buffet did notW believe hedge fund manag- ers' exorbitant fees for ac- tively managed money were justified based on performance. So, in 2008, he challenged active man- agers in the hedge fund in- dustry to a $1-million bet. It was to be a classic showdown: Actively man- aged money attempting to profit by anticipating fu- ture market trends, versus the slow and steady strate- gy of passive investing buy- ing the market in a low- cost investment on a buy and hold basis. Accepting the challenge from New York City was ProtégéYork City was ProtégéY Partners LLC. The bet was whoever had the highest return after 10 years would be the winner and the mon- ey would be donated to a charity of their choice. In the first year of the competition, the stock market crashed and the in- dex fund that Buffet had in- vested lost 37 per cent of its value. The hedge fund only lost 24 per cent. The index fund per- formed better in each of theformed better in each of thef following six years. Thenfollowing six years. Thenf in 2015, Buffet's one-year return lagged by a small fraction of one per cent. fraction of one per cent. f With one year remain- ing in the competition, the Protégé Partners conceded defeat. By the end of 2016, the index fund posted an annu- al 7.1 per cent return over the previous nine years. That figure included the huge loss suffered in 2008 when the stock market plunged. The hedge fund return for the comparable timefor the comparable timef period was an annual re- turn of 2.2 per cent. Buffet's position was active man- agement with its high fees would not win. Protégé Partners ac- knowledged fees, but add- ed that market risk some- times matters more. The notion is that high fees pro- duce better results and are therefore justified. The two sides adjusted the terms of the bet during the competition and the money was $1.4 million. Warren Buffet's charity ofWarren Buffet's charity ofW choice to receive the mon- ey was Girls Incorporated of Omaha. Peter Watson, of Peter Watson Investments MBA, CFP®, R.F.P., CIM®, FCSI offers a weekly financial planning column, Dollars & Sense. He can be contact- ed through www.peterwat- soninvestments.com. OPINION WARREN BUFFET WINS $1-MILLION BET CHALLENGE ULTIMATELY BENEFITS CHARITY, WRITES PETER WATSON PETER WATSON Column