Well, as it turns out you were wrong. Out of 400 mutual funds available to the average buyer, only 2 in of those have ever beat the markets over their length. Two. The average deducted percentage fee from those mutual funds was 2%, though the average advertised deduction was ~1%.

Index funds have an average fee of only 4 basis points. Passive investing has proven in the data it's a far superior way of investing. If you invested $1 in an index fund that matched the market with a 4 basis point fee, over $50 you'd have $32. If you invested $1 in one of the two funds that beat or matched the market, with a ~190 basis point fee, you'd have $10 over the same period. The argument you gave in favor of mutual funds gives way too much credit to the fund managers abilities to consistently pick stocks, or anybody for that matter. You also almost ignore the fact if a market goes down, almost certainly will the performance of a mutual fund in that sector. Market-wide IFs hold the same risk mutual funds do, 99.5% of the time less risk, and on average are 100x cheaper for fees.

Check it out a little more, hopefully you'll change your mind.