The mid-cap value mutual funds provide excellent opportunities for investors looking for returns with lesser risk by gaining exposure to stocks that are available at a discounted price. While large companies are normally known for stability and the smaller ones for growth, mid-caps offer growth and stability simultaneously. Companies with market capitalization between $2 billion and $10 billion are generally considered mid cap.
Meanwhile, value mutual funds are those that invest in stocks trading at discounts to book value and have a low price-to-earnings ratio along with high dividend yields. Value investing is always a coveted strategy, and for a good reason. After all, who doesn’t want to add stocks that have low PEs, a solid outlook and decent dividends? However, not all value funds solely comprise companies that primarily use their earnings to pay out dividends. Investors interested in choosing value funds for yield, should surely check the mutual fund yield.
Below we share with you three top-ranked mid-cap value mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of funds.
Fidelity Mid Cap Value Fund FSMVX invests a large chunk of its assets in securities of those mid-cap companies that have market capitalizations similar to those included on the S&P MidCap 400 Index or the Russell Midcap Index. The fund seeks capital growth for the long run. FSMVX invests in both U.S. and non-U.S. companies. FSMVX has returned 51.5% over the last one-year period.
As of the end of July 2021, FSMVX held 95 issues, with 5.9% of its assets invested in CBRE Group Inc Class A.
Vanguard Selected Value Fund Investor Shares VASVX seeks growth of capital and income for the long run. VASVX invests its assets heavily in undervalued stocks issued by mid-cap domestic companies. Undervalued stocks are those whose prices trade below the book value. VASVX has returned 56.1% over the last one-year period.
Richard Lawrence Greenberg is one of the fund managers of VASVX since 2005.
Bridge Builder Small/Mid Cap Value Fund BBVSX seeks to offer an appreciation of capital. BBVSX invests a large chunk of its assets in securities of both small- and mid-capitalization companies. The fund invests in both domestic and foreign companies. BBVSX has one-year annualized returns of 52.3%.
BBVSX has an expense ratio of 0.42% as compared with the category average of 1.01%.
To view the Zacks Rank and past performance of all mid-cap value mutual funds, investors can click here to see the complete list of funds.
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