when investing in a professionally managed fund an investor gives up control to the money manager running it in addition he incurs additional costs in the form of management fees charged annually as a percentage of the assets under management aum fees reduce a fund s total return 
some mutual funds also charge a load or sales charge funds will vary on when this fee is billed but most common are front end loads paid at the time of purchase and back end loads paid at the time of divesting an investor will file and pay taxes on fund distributed capital gains these profits are spread evenly among all investors sometimes at the expense of new shareholders who did not get a chance to benefit over time from the sold holdings if the fund sells holdings often capital gains distributions could happen annually increasing an investor s taxable income example of a pooled fundthe vanguard group inc is one of the world s largest investment management companies and providers of retirement plan services the firm offers hundreds of different mutual funds etfs and other pooled funds to investors around the world for example its canadian subsidiary vanguard investments canada offers canadian investors many pooled fund products these products include 39 canadian etfs and four mutual funds along with 12 target retirement funds and eight pooled funds the two latter groups are available to institutional investors one of the pooled funds vanguard global ex canada fixed income index pooled fund cad hedged invests in foreign bonds in april 2019 it took a new benchmark the bloomberg global aggregate ex cad float adjusted and scaled index to take advantage of including the chinese government policy bank bonds in its canadian portfolio offering 