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Because it’s almost Christmas, a related joke from Warren Buffett:

"I heard they called off the Wall Street Christmas pageant because they couldn’t find three wise men"

The point being that most fund managers do not outperform the index, so 2% more or less isn’t that important.

Umm, fun joke, but 2% over- or under-performance is HUGE, especially compounded over years.

It is the reason behind the common recommendation to buy only low-load or no-load funds; because a 1% or 2% load vs a zero or 0.1% load is almost impossible to overcome — over time, the no-/low-load funds will win.

The comment wasn’t that 2% doesn’t matter. It was that even with the 2% from your ugly fund manager you should still just buy index funds

The average fund manager does not underperform by more than 2%.

The average includes the over performers

The incentive for fund managers is to make as much profit as possible and not care much about losses. If you take into account that fund managers typically blow up every 10 or so years, then they do underperform by more than 2%. Read Taleb's books for more information.

after fees. most managers don’t outperform after fees

Plus a lot funds aren't trying to beat the market but instead reduce variance.

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