No, it means that the hedge fund of funds which made the bet underperformed the S&P.

Hedge Fund of funds are typically horrible investors. In addition to the additional layer of fees, they love funds that have been performing well. It is pretty much unheard of for them to invest in a fund that has had a rough time...for example a gold stock fund as of Dec 31, 2015. How many hedge fund of funds do you think invested in gold stock funds then? Their 5 year track record was horrendous and when the FOF has to put their "model portfolio" which they show to prospective investors, they would have to include the crappy performance which which drag down the hypothetical portfolio returns.