You may be interested to read the other guy's take on that bet. One of the more interesting reads on the business of running a hedge fund I've seen.

http://blogs.cfainstitute.org/investor/2015/02/12/betting-wi...

(Disclosure: I work at CFAI)

The article is bs and reeks of ass-covering (and lots of other folks agree). If S&P 500 was such a bad benchmark, why did he bet $320k on being able to beat it? The other points (interest rates etc) amount to "We couldn't predict the future", which would normally be fine, but not when you are charging 2 & 20 to do so.

Edit: a better response - http://msantoli.tumblr.com/post/110804679383/cry-me-a-river-...

>I strongly recommend "Fooled by Randomness",

Its a really good read and can be applied to life outside of investment.

It's nice to see them put their money where their mouth is on this one.

And it's great to see the $1M is actually up around $1.7M at this point. Hopefully it continues to grow before it gets donated to charity.

I'm guessing the money manager was able to get some new client funds because of his ability to put his money where his mouth is. 'I put my own money in this' is a strong argument. If it gained him $500m in funds at 2% fee, then a 1 mil losing bet is covered by new accounts in year 1.

Also take a look at "The Drunkard's Walk" - same vein.