It's not surprising there exist individual people who are capable of beating the market, just like it's not surprising there exist people who can play sports at an elite level. You likewise wouldn't expect every human to be able to play at the elite level.

Aggregate performance should cluster around a point of central tendency.

This changes the equation somewhat since he can swoop in (dangling a billion dollar check) and do all sorts of research and investments that are unavailable on the open market.

He also (through Geico and other insurance holdings) gets to invest a ton of borrowed money at what amounts to a negative interest rate. (insurance premiums are, in aggregate, a loan to the insurance company until the customers need that money back. With the added benefit that you can repay less than you were given if your business ops are lean enough. That's why Geico pushes to do sales over the phone or internet, much cheaper than agents).

I am, of course, butchering this explanation. If you want an inside look at what he's doing, his letter to shareholders lays it ALL out.

He's not really an "active" investor in the sense he uses the term, I think - his ethos is to buy and hold for a long time - almost the polar opposite of the "managed funds", isn't it?