This is a silly analysis in that it ignores investment costs. You can't invest in the S&P 500. You have to either buy an index mutual fund, or buy the individual component stocks. Either way the investment costs will significantly cut into long term returns, even with a fund like VFINX.
It can be even cheaper than that. If you buy VOO, the ETF equivalent of VFINX (Vanguard's ETFs hold the same portfolio as their corresponding funds), the expense ratio will be only 0.05%. If you buy this ETF through Vanguard, you will not pay any commissions. It's very close to being free, and definitely the cheapest way to invest in the S&P 500.
