[gull]

I agree, but I'm still in index funds.

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Burton Malkiel says that mutual funds regularly underperform by 2% on an annual basis. Since the average mutual fund costs about 1.3%, that means that most funds are losing 70bps per year in alpha. Index funds are losing 15-20bps per year in alpha.
However, this also means that other players in the market, by definition, are generating significantly positive alpha. After all, if 70% of funds have negative alpha the other 30% are gaining all of that alpha,

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The underperformance of mutual funds isn't completely due to negative alpha and fees.