The Hornets were unable to pick up anything from the game away from home, with heavy snow falling at the King Power Stadium for most of the contest.
However, Ranieri did not choose to blame conditions as he returned to his old club, where he won the Premier League as manager.
"It was a Christmas day condition but that's okay," said Ranieri.
"The two teams played, fought and everything was good. Sometimes it could happen in England, but it wasn't the pitch, we lost because we made mistakes and Leicester scored the chances they had. We didn't score our chances.
"If you see the match we created more chances than Leicester, but they scored the goals and we didn't score ours.
"I'm positive because it's important the team tries to create chances to score the goals - of course we have to be focused in some moments of the match because we conceded four goals and it wasn't so good, we can do better. At the end of the match, they won because they were more aggressive and more determined than us."
He added: "I'm very frustrated but if you imagine we are working together for one month and a half, I'm satisfied.
"Okay, there was something no good but I speak with my players and the more important thing in my opinion was they were very very aggressive and we today weren't.
"This is the balance of the match. If we were determined we score, not all the chances, but a lot of the chances, we would score the goals."
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