OMAHA, NEB.: Billionaire Warren Buffett has wagered roughly $320,000 of his own money that the S&P 500 will outperform a collection of hedge funds.

The bet covers a decade and says that all the fees, costs and expenses must be included.

The terms of the bet between the chairman and CEO of Berkshire Hathaway Inc. and the money managers who own Protege Partners LLC are outlined on the Long Bets Web site. That group will hold the wager until the bet concludes at the end of 2017.

The specifics of the wager were first reported online by Fortune magazine. The wager is invested in a bond so that the winner will be able to donate $1 million to a charity at the end.

Buffett has long been critical of hedge funds because of the high fees they charge investors. At Berkshire Hathaway's 2006 annual meeting, he offered to bet $1 million that an index fund would beat any 10 hedge funds over a decade if all the fees were included.

One of Protege's co-founders, Ted Seides, sent Buffett a note last summer to take him up on the offer.

''The idea is to settle a long-standing debate in the investment community over the value of active and passive management,'' said Seides, whose company invests in hedge funds.

They agreed to the terms of the current bet, which is based on the performance of five portfolios of hedge funds. Seides declined to name the funds involved because of concerns about the Securities and Exchange Commission rules that bar hedge funds from promoting themselves.

Buffett's spokeswoman Jackie Wilson did not immediately respond to a message.

But Buffett has detailed his concerns about hedge fund managers and their fees in his recent letters to shareholders in his holding company, which owns more than 60 subsidiaries.

Buffett often refers to hedge fund managers as the 2-and-20 crowd because they routinely charge investors 2 percent of their principal and 20 percent of their profits each year. Those high fees diminish the returns active investors receive.

''Investors, on average and over time, will do better with a low-cost index fund than with a group of funds,'' Buffett wrote on the Long Bets site.

In 2006, Buffett devoted two pages of his letter to the perils of the 2-and-20 crowd in a fable titled ''How to Minimize Investment Returns.'' The story described the fictional Gotrock family which owned all American corporations, and the Helpers — brokers, managers, consultants and hedge fund managers — who consume more and more of the family's earnings.

''The burden of paying Helpers may cause American equity investors, overall, to earn only 80 percent or so of what they would earn if they just sat still and listened to no one,'' Buffett wrote.

Buffett's company has performed well over the past decade with its stock price advancing from $78,000 in June 1998 to about $130,000 today.

It set a new high of $151,650 in December, and Berkshire remains the most expensive U.S. stock.

Seides said he hopes this wager will help more people learn about hedge funds and their purpose. He said hedge funds aren't trying to beat the market; they're using a variety of strategies to deliver positive results in all kinds of conditions.

Seides cautioned that hedge funds aren't for everyone. Only knowledgeable investors with more than $1 million in assets are allowed to invest in them, according to SEC rules.

Berkshire owns a variety of companies, including insurance, clothing, furniture, jewelry and candy companies, restaurants, natural gas and corporate jet firms and has major investments in such companies as Coca-Cola Co., Anheuser-Busch Cos. and Wells Fargo & Co.