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Commingled Fund: Definition, Benefits, Functioning, and Examples

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Updated October 10, 2025

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What Is a Commingled Fund?

A commingled fund is a single portfolio with assets pooled from various accounts. This reduces management costs and achieves economies of scale. Unlike mutual funds, commingled funds are not publicly traded or regulated by the SEC.

Retirement plans and pension funds commonly use them. Institutional investors or high-net-worth individuals typically use commingled funds because they're drawn to the lower fees. That said, commingled funds have disadvantages like limited transparency and availability.

Key Takeaways

Commingled funds combine assets from multiple institutional investors to reduce management costs and benefit from economies of scale.
Unlike mutual funds, commingled funds are not regulated by the SEC and do not have ticker symbols.
Commingled funds are typically available to institutional investors and not to individual retail investors.
Although they offer less transparency, commingled funds often have lower fees than mutual funds due to simpler reporting requirements.

How Commingled Funds Operate

Commingling combines assets from different investors into one fund or investment vehicle. Commingling is a primary feature of most investment funds. It may also be used to combine various types of contributions for various purposes

In some ways, commingled funds are similar to mutual funds. Both are professionally managed by one or more fund managers and can invest in basic financial instruments such as stocks, bonds, or a combination of both.

Also, like mutual funds, commingled fund investments benefit from economies of scale, which allow for lower trading costs per dollar of investment, and diversification, which lowers portfolio risk.

However, commingled funds also differ from mutual funds. There's no 12(b)-1 marketing fee and often lower administration fees, because they're not publicly marketed and the reporting requirements are different.

Regulatory Oversight of Commingled Funds

Commingled funds are not regulated by the Securities and Exchange Commission (SEC), which means they are not required to submit a variety of lengthy disclosures. Mutual funds, on the other hand, must register with the SEC and abide by the Investment Company Act of 1940.

Commingled funds are reviewed by the Office of the Comptroller of the Currency and state regulators.

Mutual funds provide a prospectus, while commingled funds offer a Summary Plan Description (SPD). SPDs can offer more detail, describing the fund's objectives, investment strategy, and background of its managers. It also describes the rights and obligations of the plan participants and beneficiaries. Any participant in a plan offering a commingled fund should read the SPD carefully.

Fast Fact

To learn how a commingled fund performs on a day-to-day or quarterly basis, you'll most likely have to contact your company retirement plan’s information center for an update.

Pros and Cons of Commingled Funds

Advantages

Less regulation means lower legal and operating costs for a commingled fund. With the same performance, a commingled fund’s net return can be better than a mutual fund due to lower expenses.

Disadvantages

Commingled funds lack ticker symbols and aren't traded publicly. This makes it harder for outsiders to track gains and income, unlike mutual funds where this info is transparent.

Pros

Professionally-managed
Diversified portfolio
Lower fees and expenses than mutual funds
Economies of scale

Cons

Illiquid
Less transparent/harder to track
Not SEC-regulated
Limited availability

Real-World Example of a Commingled Fund

Companies with qualified employee benefit plans can access the Fidelity Contrafund Commingled Pool.

Like mutual funds, it has a manager and shares information in quarterly reports. It targets large-cap growth stocks, tech, services, and health sectors. Unlike mutual funds, it's not for the general public.

The Contrafund Commingled Pool has a 0.43% expense ratio. Since 2014, the fund has returned 14.69% annually, compared to the S&P 500's 12.96%.

Important Considerations for Commingled Funds

In some cases, the commingling of funds may be illegal. This usually occurs when an investment manager combines client money with their own or their firm's, in violation of a contract.

Details of an asset management agreement are typically outlined in an investment management contract. Investment managers must adhere to fiduciary duties when managing assets. Assets agreed to be managed as separate cannot be commingled by the investment advisor.

Other legal situations may also arise where contributions provided by a client must be managed with special care. This can occur in legal cases, corporate accounts, and real estate transactions.

What Types of Commingled Funds Are There?

Types of commingled funds can include equity, fixed income, and alternative investment funds. The last of these might have hedge funds, derivative investments, and private equity investments in its portfolio.

Can Anyone Invest in a Commingled Fund?

Normally, no. The typical investor is an institutional investor. Individuals usually can't put their money into a commingled fund unless they're a high-net-worth, accredited investor.

Where Do I Get Information About a Commingled Fund?

Usually from your employer, if your workplace retirement plan invests in commingled funds. Typically, you won't find public sources, such as newspapers, providing information on them because they aren't publicly traded investment vehicles. Some investment companies may offer quarterly and annual reviews of performance.

The Bottom Line

Commingled funds are pools of assets from multiple institutional investors managed by professionals. They have reduced regulatory oversight compared to mutual funds. They're not regulated by the SEC but are overseen by other bodies like the Office of the Comptroller of the Currency and state regulators. But they have some limitations as well. They're not publicly traded, they lack ticker symbols, and they're not readily accessible to individual investors except through specific retirement plans.

Potential investors can find more information through their employers or investment companies' performance reports.

Article Sources

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Fidelity. "QUARTERLY REVIEW: Fidelity® Contrafund® Commingled Pool."

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