[alasdair_]

Right, and a lottery winner who wins a $500MM jackpot on a $1 ticket has annualized return of even more than that, when annualized over the same timescale.

None of that matters if you can't pick the winning players in advance. With enough variance and enough players, someone will eventually have double-digit annualized returns over decades, it doesn't mean that they are necessarily superb investors.

[Gustomaximus]

The BIG difference is someone can go invest in Greenblatt or Icahn's fund with a reasonable expectation of these returns ongoing. Not so with a lottery winner.

[mehwoot]

Joel Greenblatt's new funds that he set up since returning in 2009 haven't done well, they have performed below the S&P 500 Index from 2009-2015:

http://www.forbes.com/sites/antoinegara/2015/07/31/value-gur...

[auntienomen]

What would you think if you saw someone win the lottery 2 months out of every 3 for 20 years?

[hodder]

Buffett has actually picked the winners in advance in his great essay:

http://gdsinvestments.com/wp-content/uploads/2015/07/The-Sup...

That said, a fund this size should be taking as passive of an approach as possible.

[greenleafjacob]

How would your position be falsified? You could always say that later someone will revert to the mean.

[Retric]

Simple, compare a large number of investors based on some criteria with the overall average.

AKA, if you think there are people that do better than average, then picking people who have beaten the odds for 10 years and see how they do over the next 10 years. Repeat over a few decades.

There are things that seem to work. The most common way to 'beat the market' is trading a low chance and ideally hidden chance of failure for inflated returns. EX: A 1 percent change of losing 95% of your investment should be worth lot's of money on good years. This is really appealing when investing other peoples money as you don't share in their downside.