[gmunu]

Actually, I think the studies generally show that active mutual funds do beat the market, but before fees. Their alpha, while real, is tiny and more than eaten by their fees.

Yet remember that active mutual funds manager fees are close to 1%. If you pay $60M on $900B, we're talking about paying less than 1 bp! So if you have an average active mutual fund manager running your $900B fund for $60M, you might hope to beat the market by a few basis points.

[cmdkeen]

What you also have to appreciate is that the fee scales you mention are for you investing $10,000 with an active manager. If you're investing billions you won't be paying anything close to that. If you have the world's largest sovereign wealth fund you're operating at a scale even larger than that.