Editor's note: With the markets offering up a seemingly endless parade of surprises, investors are looking for mutual-fund managers who can handle anything thrown at them. In this special report, SmartMoney focuses on funds run by managers who have successfully navigated years worth of market euphoria and panic -- and helped keep investors ahead. We highlight funds that specialize in five categories: large company stocks, foreign stocks, global investments, balanced investments and real estate.

George Cipolloni got his first lesson in just how wild markets can become back in 1998, when he was an intern at the Philadelphia Stock Exchange. He stood next to traders bidding up the stock prices of Amazon.com and other profit-free Internet stocks. Even to his young mind, Cipolloni thought that what was happening on the trading floor was completely irrational. It was like everyone was a bookie, he says now.

That kind of gambling mentality is nowhere to be found at the Berwyn Income fund, which Cipolloni, 35, comanages. One of the more conservative funds on the market, it holds up to 30 percent in dividend-paying stocks, with the rest in bonds and other fixed-income securities. Cipolloni and his comanagers stick with companies whose businesses are expanding without relying on takeovers or financial engineering. From their office in Berwyn, Pa., the duo runs screens to find picks, often looking for high returns on capital. After finding potential candidates, they pore over financial statements and meet with management teams. A handful of familiar names make it in, such as Microsoft and JPMorgan Chase. But they often wind up with companies such as insurer Chubb or consumer product producer Kimberly-Clark big firms, to be sure, though not ones Wall Street fawns over. We re not trying to find the next hot stock, says Munsch. Even the fixed-income holdings are pretty tame. The fund owns about 50 bonds, a few energy firms and Wal-Mart among them.

Keeping an eye on market valuations has helped the fund avoid losses and find bargains. In late 2007, the fund managers sensed the market was overvalued and started selling stocks; by 2008 they had only 20 percent in equities. The result: a loss of 10 percent in 2008, a year when the market lost nearly 40 percent. Conversely, with the markets at their scariest in early 2009, they started buying high-yield debt, convertible bonds and beaten-down stocks. That contrarian strategy took a leap of faith. You re buying values that eventually will be recognized by the market, says Raymond Munsch, a 30-year investing veteran and co-manager of the fund. The gambit worked, and the fund gained nearly 30 percent last year, beating the S&P 500 index by seven percentage points.

Of course, Berwyn s conservative style sometimes holds it back. The fund got out of real estate stocks in early 2006, missing a year of gains in the sector (Munsch concedes they sold a little too early). And the managers may stick with stocks as they go from cheap to cheaper. For example, they held New York Community Bancorp in 2008 as the stock plunged over 40 percent (it has since bounced back). They also added to a stake in Methode Electronics, a maker of electrical devices, even as the stock lost over half its value (it also has rebounded). More recently, the managers have been raising their cash position and rejiggering their bond holdings to guard against a hike in interest rates. There aren t as many bargains in the market these days, and a correction could be coming, says Cipolloni. If that happens, he adds, we d rather be early getting out than late.

Winner

Managers: George Cipolloni, Raymond Munsch, Robert Killen and Lee Grout
Assets: $726 million
Expenses per $10,000: $73
Minimum investment: $3,000
5-Year avg. annual return: 6.5%
10-Year avg. annual return: 8.5%
Quick Take: This yield-oriented fund holds up to 30 percent in dividend-paying stocks and boosts income with corporate bonds.

Runners-Up

Manager: Charles Carlson
Assets: $534 million
Expenses per $10,000: $106
Minimum investment: $2,000
5-Year avg. annual return: 4.8%
10-Year avg. annual return: 8.2%
Quick Take: Carlson hunts for small-cap value stocks and holds bonds and convertible securities; the prudent mix keeps losses low in bear markets.

Manager: 10-member team
Assets: $718 million
Expenses per $10,000: $110
Minimum investment: $2,000
5-Year avg. annual return: 4.4%
10-Year avg. annual return: 3.9%
Quick Take: A conservative fund, it splits almost evenly between large company stocks and bonds.

15 Award-Winning Funds

• Overview
• U.S. Large-Cap Funds
• Foreign Funds
• Global Funds
• Balanced Funds
• Real Estate Funds
• PLUS: 5 Big Funds to Reconsider