[Htsthbjig]

"Why are actively managed funds paid via fees, and not based on performance?"

Simple, As Warren Buffet said when he created an investment firm, he expected to be judged over the general market wave, that is if the market crashes 75%(like in 2008 or the great depression) just maintaining the funds worth(or loosing small) is a great deal and you are a genius. If the market skyrockets 50% per year and you get 10%, you are not so good.

Putting it another way, they are already based on performance over the market.