6 Best Mutual Funds for Value Stocks

No one would mistake Wall Street for Fifth Avenue, but they do have one thing in common: As sure as hemlines rise or fall, or ties grow fat or narrow, investing styles come into and go out of fashion.

(Image credit: Illustration by Pablo Bernasconi)

No one would mistake Wall Street for Fifth Avenue, but they do have one thing in common: As sure as hemlines rise or fall, or ties grow fat or narrow, investing styles come into and go out of fashion. This year, you’ll find value stocks in some of the smartest portfolios. As the moniker implies, value stocks are those that are cheap in relation to a company’s sales, profits or underlying assets. And for reasons that are less whimsical than the fashion dictates of Fifth Avenue, shopping in the bargain basement is paying off so far this year.

Year-to-date through June 30, the S&P Value index returned 6.2%, compared with 1.6% for the S&P Growth index. And midsize-company value funds, small-company value funds and large-company value funds occupy the top three slots so far this year among Morningstar’s nine style categories for domestic mutual funds.

Because value investors dabble in the unloved corners of the stock market, they need a steady hand and a contrarian mind-set — as you'll find at the helm of these 6 mutual funds poised to harness the power of value stocks.

All data as of June 30.

Nellie S. Huang
Senior Associate Editor, Kiplinger's Personal Finance

Nellie joined Kiplinger in August 2011 after a seven-year stint in Hong Kong. There, she worked for the Wall Street Journal Asia, where as lifestyle editor, she launched and edited Scene Asia, an online guide to food, wine, entertainment and the arts in Asia. Prior to that, she was an editor at Weekend Journal, the Friday lifestyle section of the Wall Street Journal Asia. Kiplinger isn't Nellie's first foray into personal finance: She has also worked at SmartMoney (rising from fact-checker to senior writer), and she was a senior editor at Money.