Fidelity Low-Priced Stock has an enviable track record. Its 11.1% average annual return over the last decade puts it in the top 2% of Lipper s mid cap core category. It has done similarly well over shorter time periods, too.

Funds with track records like that routinely make our screens. However, this Fidelity offering didn t show up until the parent company decided to reopen it to new money after a two year closing. Since reopening a year ago, this fund has made our cuts for performance and manager tenure.

Fidelity Low-Priced Stock is featured on this week s screen for medium-size-company funds. The midcap sector has been one of the strongest performing of the mutual fund world this year. The average midcap fund is up 32% in 2009. We started with a universe of just over 1,100 funds and quickly trimmed that group by disqualifying funds that charge sales loads and high annual expense ratios. The funds also had to be up at least 20% in 2009 and above-average performers during the trailing three- and five-year time periods. Eighteen funds made the cut.

The midcap space can be one of the more complex of the fund world. There is plenty of research on large-cap stocks for managers to pick over. Meanwhile, small caps can be extremely volatile. Midcaps can offer both a lot of research and a lot of movement.

The 2008 downturn clipped the valuations of many large-cap companies so that they actually qualified as midcaps (typically defined as having market capitalizations between $2 billion and $10 billion). Meanwhile, small-cap stocks that grow can gain the favor of the market leading to a rich valuation. A midcap manager needs to be able to research both kinds of stocks.

Both points are actually playing in midcap funds favor. As the market has risen this year, some investors have been willing to take on more risk by buying small-cap stocks. And investors are also realizing those beaten-down large caps may actually be bargains in disguise. Even some of the financial names have seen significant increases in share prices.

That said, not every investor needs to jump into this space. Many diversified, actively-run funds have midcap exposure, and the typical S&P 500 fund has 13% of its assets in this category. That is plenty for most investors.

The Criteria: The midcap funds on our list are open to new money, require a minimum investment under $5,000 and charge an annual expense ratio less of than 1.5%. In addition, their track records on the trailing three- and five-year time periods put them in the top 25% of the category. They were also up at least 20% in 2009. As usual, we did not include funds that charge a sales load.

Recipe

Fund Type = Mid Caps
Annualized 3-Year Return (%) = Display Only
Rank in Classification (%) (3 year performance) <= 25
Annualized 5-Year Return (%) = Display Only
Rank in Classification (%) (5 year performance) <= 25
Expense Ratio <= 1.5%
Load Fund (type) = No Load
Minimum Initial Investment <= $5,000
Open to New Investors = Yes
Total Net Assets ($ millions) >= 50
Year-to-Date Return (%) >= 20%