<div id="readability-page-1">Key Takeaways Brokerage commissions, bid-ask spreads, and taxes steadily erode your returns, even when your stock picks look smart on paper.Buffett’s decade‑long $1 million bet proved the point. A low‑cost S&amp;P 500 index fund beat a hand-picked basket of hedge funds by almost four‑to‑one between 2008 and 2017.Skill is rare, costs are certain. While ...</div>

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<p>Warren Buffett highlights that brokerage commissions, bid-ask spreads, and taxes erode investment returns. His $1 million bet showed that a low-cost S&P 500 index fund outperformed a hand-picked basket of hedge funds by nearly four-to-one from 2008 to 2017. Buffett emphasizes that while skill is rare, costs are certain.</p>

- Brokerage commissions, bid-ask spreads, and taxes diminish investment returns despite seemingly smart stock selections.  
- Warren Buffett's $1 million bet over a decade demonstrated that a low-cost S&P 500 index fund outperformed a curated group of hedge funds nearly four-to-one from 2008 to 2017.  
- This highlights that while investment skill is uncommon, the costs associated with trading are predictable and impactful.  

Buffett Reveals the Habit Holding Investors Back, Here’s How Breaking It Boosts Returns