When a taxpayer buys into a stock fund with unrealized capital losses, they are buying at a discount because of the tax benefits.
XYZ Fund now holds $1 billion in assets. Those assets, stocks bought in prior years at higher prices, have a basis of $2.5 billion. Therefore, the taxpayer is buying into $1.5 billion of unrealized tax losses 150% of the funds assets. At the 15% tax rate on capital gains, that is a 22.5% bonus, which results into buying $122.50 worth of assets for every dollar invested in XYZ Fund.
If you buy into a stock fund with unrealized capital losses, you may be buying at a discount.