3 Top-Performing Mid-Cap Value Funds

While the overall stock market has slipped in 2025, the average mid-cap value fund is up nearly 1% in the year to date. Looking at longer-term performance, we screened for mid-cap value funds with the best returns over the last one-, three-, and five-year periods. Three funds made it through the screen:

• Hotchkis & Wiley Value Opportunities Fund HWAZX
• Invesco BuyBack Achievers ETF PKW
• SPDR Russell 1000 Yield Focus ETF ONEY

Mid-Cap Value Funds Performance

Over the last 12 months, mid-cap value funds have returned 10.05%. On an annualized rate, these funds have returned 6.13% over the last three years and 12.09% over the last five. That compares with the Morningstar US Market Index, which has returned 14.68% over the last 12 months, 11.30% per year over the last three years, and 15.44% per year over the last five years.

What Are Mid-Cap Value Funds?

Some mid-cap value portfolios focus on medium-size companies while others land here because they own a mix of small-, mid-, and large-cap stocks. All look for US stocks that are less expensive or growing more slowly than the market. The US mid-cap range for market capitalization typically falls between $12 billion and $70 billion and represents 20% of the total capitalization of the US equity market. Value is defined based on low valuations (low price ratios and high dividend yields) and slow growth (low growth rates for earnings, sales, book value, and cash flow).

Screening for the Top-Performing Mid-Cap Value Funds

To find the best mid-cap value funds, we looked at returns data from the past one, three, and five years using data available in Morningstar Direct. We screened for open-ended and exchange-traded funds in the top 33% of the category using their lowest-cost primary share classes for those periods. We also filtered for funds with a Morningstar Medalist Rating of Neutral or better. We excluded funds with assets under $100 million and analyst coverage that was not 100%. This left three names.

Because the screen was created with the lowest-cost share class for each fund, some may be listed with share classes that are not accessible to individual investors outside of retirement plans, or they may be aimed at institutional investors and require large minimum investments. The individual investor versions of those funds may carry higher fees, reducing returns. In addition, Medalist Ratings may differ among the share classes of a fund.

Hotchkis & Wiley Value Opportunities Fund

• Morningstar Medalist Rating: Silver
• Morningstar Rating: ★★★★★

Over the past 12 months, the $673 million fund has gained 15.49%, while the average fund in its category is up 10.05%. The fund, launched in September 2019, has climbed 11.02% over the past three years and 17.28% over the past five.

“This contrarian offering uses an approach similar to the firm’s equity-only strategies, but it has a much broader opportunity set. While it shares the firm’s focus on buying deeply out-of-favor companies that can return to normal earnings, it has the flexibility to invest across the capital structure and market-cap spectrum, with valuations driving asset-allocation and sector decisions. It has primarily owned equities in recent years but invested as much as 12% of assets in bonds in 2016. It may also invest in special situations such as risk arbitrage and buy stakes in private firms. The 40- to 70-stock portfolio is consistent with the firm’s deep-value identity, and the team often leans into unloved sectors, industries, or companies. For instance, during 2022’s equity selloff, Green allocated more to nontraditional value sectors, namely technology, scooping up additional shares in Microsoft MSFT. This proved very beneficial for 2023 performance, and they have since taken some profits, consistent with their sell discipline.”

—Chris Tate, senior analyst

Invesco BuyBack Achievers ETF

• Morningstar Medalist Rating: Neutral
• Morningstar Rating: ★★★★★

Over the past 12 months, the $1.2 billion fund has gained 13.47%, while the average fund in its category is up 10.05%. The Invesco fund, launched in December 2006, has climbed 9.85% over the past three years and 15.62% over the past five.

“Invesco BuyBack Achievers ETF aims to outperform the market by selecting only stocks of companies that have recently conducted large share repurchases. Stocks that make the cut should boast strong fundamentals, but shortcomings in the fund’s screening process limit its exposure to high-quality firms and increase risk.”

—Zachary Evens, analyst

SPDR Russell 1000 Yield Focus ETF

• Morningstar Medalist Rating: Silver
• Morningstar Rating: ★★★★

The $820.9 million fund has climbed 12.56% over the past 12 months, outperforming the average fund in its category, which rose 10.05%. The State Street fund, launched in December 2015, has climbed 7.12% over the past three years and 14.94% over the past five.

“This index strategy starts with the Russell 1000 Index portfolio and adjusts stocks’ weights to favor those with high dividend yields, attractive valuations, strong quality traits, and smaller market capitalizations. Bending toward the value, quality, and small-size factors should aid performance because they have historically been tied to market-beating returns. The blend also creates balance, as quality and value tend to thrive at different times. Yield is the focus, though; it is weighted twice as heavily as the other factors. This can invite risk. High-yielding stocks tend to pay out a large share of their earnings as dividends. Others may generate a high yield from their declining stock prices, which can reflect deteriorating fundamentals.”

—Ryan Jackson, senior analyst