(Bloomberg) -- Warren Buffett's sweeping endorsement of index investing is sure to sting the hedge-fund industry and encourage the stampede into assets that passively track the market.

In his well-read annual letter to Berkshire Hathaway shareholders on Saturday, he estimated that investors wasted more than $100 billion on high-fee Wall Street money managers over the past 10 years. He declared an early victory in his decade-long bet that a basket of hedge funds would fail to keep pace with an S&P 500 Index fund. And he called Jack Bogle, the Vanguard Group founder who pioneered low-cost market trackers, a "hero."

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