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Why does Warren Buffett say his fund performance, relatively, is likely to be better in a bear market than in a bull market?
Buffett is a value investor. His goal is to buy good companies when the market is overly worried and prices them below intrinsic value. When the market is highly priced it is much more difficult for him to find things that he thinks are at an attractive price. When people are very worried and the market has crashed, stocks are then priced below their intrinsic value and he can use the cash he keeps in the company to make attractive purchases. Remember that Buffett is not concerned with the ups and downs of the price of Berkshire Hathaway stock, he is concerned with the economic value of the assets that the company owns. So if all stock prices crash and he can buy things that are at bargain prices, he is happy no matter what Berkshire stock price does in the short run. One consequence of value investing is that because you are buying assets at bargain prices, the total value of your assets drops less in a bear market than the highly priced stuff that drives the major indexes.