Small-cap value mutual funds provide excellent choices for investors looking for bargains, i.e., stocks at a discount with impressive growth potential. Value mutual funds comprise stocks trading at a discount to book value, with low price-to-earnings ratios and high dividend yields.
Value investing is a very popular strategy, and for good reason. After all, who doesn’t want to find stocks with a low Price/Earnings (P/E) ratio, solid outlooks and decent dividends? Additionally, small-cap funds are good choices for investors with a high-risk appetite, as companies with small market capitalizations are expected to have higher growth potential than large- and mid-cap companies. Small-cap funds generally invest in companies with a market cap of less than $2 billion. Also, small-cap funds are expected to provide diversification across different sectors and companies.
Below, we share with you three top-ranked small-cap value mutual funds, namely, FPA Queens Road Small Cap Value QRSVX, Bridgeway Omni Small-Cap Value BOSVX and Pinnacle Value PVFIX. Each has a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of Small Cap Value mutual funds.
FPA Queens Road Small Cap Value seeks to achieve its objective by mainly investing in equity securities, such as common, preferred and convertible stocks of small-cap U.S. companies. Normally, it invests the majority of its net assets (including investment borrowings) in small-cap equities.
FPA Queens Road Small Cap Value has a three-year annualized return of 19.1%. As of May 2026, QRSVX held 47 issues, with 5.5% of its assets invested in Synnex.
Bridgeway Omni Small-Cap Value invests broadly in small-cap value stocks, emphasizing diversification and focusing primarily on companies listed on major U.S. stock exchanges.
Bridgeway Omni Small-Cap Value has a three-year annualized return of 16%. BOSVX has an expense ratio of 0.47%.
Pinnacle Value targets small and micro-cap U.S. companies, investing in diverse equity securities it believes are undervalued relative to their earnings potential or asset value.
Pinnacle Value has a three-year annualized return of 13.1%. John E. Deysher has been one of the fund managers of PVFIX since 2003.
To view the Zacks Rank and the past performance of all small-cap value mutual funds, investors can click here to see the complete list of small cap value mutual funds.
