One drawback of Mutual Funds (in taxable accounts) is that one can owe capital gains even when one is losing money.
This is especially true considering fund managers tend to only sell positions with gains and hold on to the positions that have lost value until they reverse back to a profit. The result is paying taxes on realized gains and not getting (much) offset by realized losses. For example last year the S&P was down 6% yet many of the actively managed large cap mutual funds clients were on the hook for 7% in realized capitol gains.