When the stock market takes a prolonged tumble, there's an argument to be made that fund managers with the flexibility to invest across the market capitalization spectrum have an added edge over competitors that are confined to a certain niche. The rationale? That these managers can easily move out of trouble spots and into areas with more growth potential, while the others can't help but get caught in the turmoil.

That's a key selling point for so-called "go anywhere" funds or what Lipper tags as multicaps. These funds can invest in every corner of the stock market and that agility seems to be paying off. According to Lipper, the average multicap fund is up 7.1% this year through Thursday. That's almost five percentage points better than the typical S&P 500 index fund and second only to midcaps when it comes to mainstream fund category performance.

This week the SmartMoney fund screen focuses on this sector, which includes 1,608 funds and share classes. We narrowed that group to 296 offerings by disqualifying load funds. In addition, we looked for funds that charged below-average fees and have top-tier three- and five-year performance track records. Their 2009 return also had to exceed that of the S&P 500. That left us with the 22 funds on the table below.

We have been keeping a close eye on this category all year for signs that it may be breaking away from the pack. When we last looked at multicaps in early March, the category as a whole was down an average 21.2%. The stock market bottomed out a few days later and has since gone on a remarkable run, gaining by more than a third. Midcaps a category we advised you to watch two weeks ago has been the biggest beneficiary of that rally. The average fund in that niche is up 9.2% this year. "We remain buyers of...midcaps," said Citigroup's small-cap and midcap equity strategist Lori Calvasina in a recent report. "We would use any near-term weakness as an opportunity to add to positions." Many of the managers of the top-performing funds in the table below have taken a similar position and have large exposure to that area in their portfolios.

Of course, there are some issues that arise when investing in multicap funds. Some advisors shy away from the category because they make asset allocation difficult. After all, an advisor can't accurately judge a client's exposure to, say, small caps, without knowing what the multicap fund owns (and that's only disclosed a few times a year). However, this can actually work in investors' favor, too. Many market watchers think stocks will soon experience a pullback before inevitably rebounding. Health care, technology, growth and small-cap stocks are all believed to be sectors that could outperform in that scenario. Instead of making a bet on each of those areas, investors can simply buy a multicap fund that has exposure to them all.

One interesting trend that emerged when we did our screen is that most of the funds in our table are managed by independent firms and several are family-run offerings. In honor of Father's Day, we recently spoke with several father-and-son investing teams including the men behind the Croft Value fund (CLVFX), which is run by Gordon Croft and his two sons, Kent and Russell. One secret they slipped us: Don't move with the pack. Says Russell Croft: "The search for inherent, hidden value with a contrarian nature we got that from our father more than anything." The fund has returned an average annual 2.4% over the last decade, good enough for a top 10% spot in Morningstar's large blend category. Key holdings as of the fund's latest filing date include Weyerhaeuser (WY), Johnson & Johnson (JNJ), Deere (DE) and Cisco (CSCO). Year to date the fund is up 11%.

We would also suggest looking at Amana Growth (AMAGX), Auxier Focus (AUXFX), Becker Value Equity (BVEFX), Westport (WPFRX) and the Yacktman funds. The funds have seasoned managers, good track records and low fees all the beginning hallmarks we look for in a mutual fund.

The Criteria: The multicap equity funds on our list are open to new money, require a minimum investment under $5,000 and charge an annual expense ratio less than 1.5%. The funds have three- and five-year track records that put them in the top 25% of their category. In addition, they're beating the 2009 return of the typical S&P 500 index fund. Finally, we did not include funds that charge a sales load.

Recipe

• Fund Type = Multicap
• 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 (%) >= 2.8