Major U.S. indexes, such as the Nasdaq Composite, the Dow Jones Industrial Average and the S&P 500, have gained 12.48%, 4.02% and 6.5% so far this year. Investors have adopted a cautious optimism due to renewed trade tensions under the Trump administration's aggressive tariff threats. The Federal Reserve has kept key interest rates unchanged as it closely watches the inflationary effects of Trump's tariffs before considering any rate adjustments.

According to U.S. Labor Department reports, the consumer price index (CPI) for June rose 0.3%, following a 0.1% increase in May. Year over year, CPI increased 2.7%, the highest since February, from 2.4% in May. Inflation data spiked mostly due to rising prices of goods impacted by President Trump's latest tariffs. Producer Price Index (PPI) for June came in flat, but year-over-year figures still indicate elevated prices. The U.S. labor market remains resilient amid increasing concerns about tariffs and job cuts by major companies. U.S. employers added a stronger-than-expected 147,000 jobs in June, while the unemployment rate edged down to 4.1%.

Amid such market conditions, investors who seek higher returns than large-cap funds but less volatility than the small-cap ones can opt for mid-cap mutual funds, such as Vanguard Whitehall Funds, Selected Value Fund (VASVX Quick QuoteVASVX - Free Report) , T. Rowe Price Mid-cap Value Fund (TAMVX Quick QuoteTAMVX - Free Report) , Nuveen Mid Cap Value Premier (TRVPX Quick QuoteTRVPX - Free Report) and Fidelity Value Fund (FVLKX Quick QuoteFVLKX - Free Report) as their major holdingsto achieve their investment objective.

These funds have the majority of their investments in sectors such as technology, finance, consumer durables and industrial cyclical, which will help investors in long-term growth and preservation of wealth.

Why Invest in Mid-Cap Value Mutual Funds?

Mid-cap value mutual funds provide excellent opportunities to seek 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.

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.

We have thus selected four mid-cap value mutual funds that boast a Zacks Mutual Fund Rank #1 (Strong Buy), have positive three-year and five-year annualized returns and minimum initial investments within $5000, and carry a low expense ratio. Notably, mutual funds, in general, reduce transaction costs and diversify portfolios without an array of commission charges mostly associated with stock purchases (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

Vanguard Whitehall Funds, Selected Value Fund invests most of its net assets in mid-cap domestic companies, which, according to the advisor, are undervalued. VASVX advisors consider a stock as undervalued if it is out of favor among investors, trading at a price below average in relation to measures estimated such as earnings and book value, and has an above-average dividend yield.

Richard L. Greenberg has been the lead manager of VASVX since Feb. 25, 2005. Most of the fund’s investments were in companies like Aercap Holdings (3%), Corebridge Financial (1.9%) and Baxter International (1.8%) as of Jan. 31, 2025.

VASVXhas three-year and five-year annualized returns of 14.3% and 17.2%, respectively. VASVX has an annual expense ratio of 0.42%. 

To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.

T. Rowe Price Mid-cap Value Fund invests most of its assets along with borrowings, if any, in equity securities of mid-cap companies. TAMVX advisors generally invest in issues with value characteristics.

Vincent Michael DeAugustino has been the lead manager of TAMVX since May 1, 2022. Most of the fund’s exposure is in companies like Kenvue (2.2%), Zimmer Biomet Holdings (2.1%) and Corning (2.1%) as of March 31, 2025.

TAMVX has three-year and five-year annualized returns of 12.6% and 14.9%, respectively. The annual expense ratio of TAMVX is 1.05%.

Nuveen Mid Cap Value Premier fund invests most of its net assets in equity securities of mid-cap domestic companies as defined by the fund's benchmark index, the Russell Midcap Value Index. TRVPX advisors choose to invest in undervalued stocks based on an evaluation of their potential worth.

David A Chalupnik has been the lead manager of TRVPX since Jan. 17, 2020. Most of the fund’s investments are in companies like L3Harris Technologies (2.4%), FirstEnergy (2.4%) and CMS Energy Corporation (2.3%) as of April 30, 2025.

TRVPX has three-year and five-year annualized returns of 11.3% and 13.9%, respectively. TRVPX has an annual expense ratio of 0.61%.

Fidelity Value Fund invests in common stocks of medium-sized companies that possess fixed assets or are undervalued with respect to factors such as assets, earnings or growth potential based on the research of Fidelity Management & Research Company LLC (FMR). FVLKX advisors preferably invest in medium-sized companies of domestic or foreign issues.

Matthew Friedman has been the lead manager of FVLKX since May 12, 2010, and most of the fund’s investments are in companies like PG&E (1.4%), Ventas (1%) and Eversource Energy (1%) as of April 30, 2025.

FVLKX has three-year and five-year annualized returns of 12.2% and 17.8%, respectively. FVLKX has an annual expense ratio of 0.63%.

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