Mutual fund rant

My job offers retirement funds through Fidelity.  Last Spring when I figured the market was due for a correction I re-jiggered my portfolio and included a new type fund called a 130/30 fund which is supposed to mitigate tumultuous markets by going both long and short.  Sounds like exactly what was needed in the market last year.  From Fidelity's site:

Strategy

  

Normally investing at least 80% of assets in common stocks of companies with large market capitalizations (companies with market capitalizations similar to companies in the Russell 1000 Index or the Standard & Poor's 500 Index. Normally establishing long and short positions in equity securities. Investing in either "growth" stocks or "value" stocks or both.

Objective

  

Seeks long-term growth of capital.

The graph is from Yahoo since the chart on Fidelity's site was conveniently "unavailable."

Here's the deal:  How the hell can a long/short fund underperform the market? Even if you had monkeys picking the stocks, the outcome should be at least less negative than the S&P 500.  And they charge 1.89% fee for this fund.  Unbelievable.

When this "economic crisis" resolves, do your think Joe Sixpack is coming back to this financial industry with his hard-earned capital? 

And you wonder why gold and Treasurys are up double digits last year.