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Mutual Fund Commentary

Value funds are those that tend to trade at prices lower than their fundamentals (i.e. earnings, book value and debt to equity). It is common for some investors to invest in value funds for income or yield. However, not all value funds comprise solely companies that primarily use their earnings to pay dividends. Investors interested in choosing value funds for yield, should be sure to check the mutual fund yield. Notably, the mutual fund yield is the dividend payment divided by the value of the mutual fund’s shares.

Meanwhile, mid-cap value mutual funds provide excellent opportunities for investors looking for returns at lesser risk by gaining exposure to stocks that are available at a discounted price. While large caps are normally known for stability and the smaller ones for growth, mid caps offer the best of both the worlds, allowing growth and stability simultaneously.

Below we will share with you three top-rated 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.

Perkins Mid Cap Value D (JNMCX - Free Report) seeks long-term capital growth. JNMCX invests a large chunk of its assets in ‘value’ stocks of companies having market capitalization within the range of the Russell Midcap Value Index. The fund focuses on investing in common stocks of mid-cap companies that are expected to be undervalued. JNMCX may also invest not more than one-fifth of its assets in companies other than mid cap firms. Perkins Mid Cap Value D has a year-to-date return of 12.8%.

JNMCX has an expense ratio of 0.53% as compared to the category average of 1.19%.

T. Rowe Price Mid-Cap Value (TRMCX - Free Report) invests the majority of its assets in companies having market capitalization within the range of the Russell Midcap Value Index or the S&P MidCap 400 Index. TRMCX seeks capital growth for the long run. T. Rowe Price Mid-Cap Value has a year-to-date return of 17.8%.

David Wallack is the portfolio manager of TRMCX since 2000.

Managed Account Mid Cap Value Opportunities (MMCVX - Free Report) seeks growth of capital and income.  MMCVX invests the lion’s share of its assets in equity securities of companies with market capitalization similar to those listed on the S&P MidCap 400 Value Index. MMCVX may invest nearly 30% of its assets in foreign securities and in securities that are denominated in foreign currencies. Managed Account Mid Cap Value Opportunities has a year-to-date return of 14.8%.

As of September 2016, MMCVX held 125 issues with 1.84% of its assets invested in Energen Corp.

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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