My understanding is that Thiel's public fund often takes loss because he is hedging other financial risk he is taking.(e.g. holding palantir after IPO, large VC investments in industries that may turn out to be based on immature research)
If that's true, it's more evil than just being bad at investing. Leveraging other people's money to make contrarian bets as a hedge to the investments you believe in enough to put your money in, when the reason those people are giving you money is to align their money with yours, is ethically if not legally fraud.