The Globe and Mail reports in its Thursday edition that Canadians would enjoy higher investment returns if they were to invest in ultralow-fee index products such as exchange-traded funds. Guest columnist Biff Matthews writes that ultralow-fee index funds and ETFs, which effectively own a fraction of the entire stock or bond market, consistently outperform most actively managed funds. The return of the broader stock market is simply the weighted average return of all investors in the market. An index fund will match the market return. The average active manager will approximate the market return before fees. Their clients will receive that return less the fee charged. Using a sports analogy, as the overall skill level increases, the difference between the top performers shrinks. The same is true in investing. As the education levels and the information available to investors has increased, the difference in levels of skill has contracted. Consequently, the relative importance of luck has increased. Warren Buffett, the epitome of a successful active investor, now recommends index products to his friends, and has instructed his executors to invest 90 per cent of his estate in a low-cost S&P 500 Index fund.