Without a doubt, value investing is a risky business, that’s why diversification is paramount. According to the godfather of value investing Benjamin Graham, a portfolio of 30 stocks is considered to the minimum required to be adequately diversified, or “as diversified as possible”.

value funds

For some, this approach is not practical as time, capital, experience and access to information all constrain the abilities of the average investor. Nevertheless, there are numerous ETFs and funds out there targeting value investments and these value funds have the diversification, cash and brainpower behind them to make choices and investments many individual investors would be unable to. So, here’s a list of four value funds that look attractive based on their holdings and historic performance.

Four Value Funds

[table]

Becker Value Equity Fund Retail Class (MUTF:BVEFX)

5-Yr Performance: 109.8%
S&P 500 5-Yr Performance: 117.3%
Net Assets: $97 million
TTM Distribution Yield: 1.14%
Beta: 1.03
Sharpe Ratio: 1.25
Standard Deviation: 12.6
Expense Ratio (Gross): 1.1%

[/table]

Top 5 Holdings:

  1. Cognizant Technology Solutions Corp (NASDAQ:CTSH)
  2. DIRECTV (NASDAQ:DTV)
  3. Intel Corporation (NASDAQ:INTC)
  4. General Electric Company (NYSE:GE)
  5. IAC/InterActiveCorp (NASDAQ:IACI)

[table]

SPDR S&P 600 Small Cap Value ETF (NYSEARCA:SLYV)

5-Yr Performance: 170%
S&P 500 5-Yr Performance: 117.3%
Net Assets: $250 million
TTM Distribution Yield: 1.1%
Beta: 1.05
Sharpe Ratio: 3.35
Standard Deviation: 10.2
Expense Ratio (Net): 0.3%

[/table]

Top 5 Holdings:

  1. Centene Corp (NYSE:CNC)
  2. Prospect Capital Corporation (NASDAQ:PSEC)
  3. Emcor Group Inc (NYSE:EME)
  4. Curtiss-Wright Corp. (NYSE:CW)
  5. ProAssurance Corporation (NYSE:PRA)

[table]

Schwab U S Large Cap Value ETF (NYSEARCA:SCHV)

4-Yr Performance: 55%
S&P 500 4-Yr Performance: 64%
Net Assets: $820 million
TTM Distribution Yield: 2.26%
Beta: 1.08
Sharpe Ratio: 2.95
Standard Deviation: 9.4
Expense Ratio (Net): 0.07%

[/table]

Top 5 Holdings:

  1. Exxon Mobil Corporation (NYSE:XOM)
  2. General Electric Company (NYSE:GE)
  3. Chevron Corporation (NYSE:CVX)
  4. Wells Fargo & Co (NYSE:WFC)
  5. The Procter & Gamble Company (NYSE:PG)

[table]

SPDR S&P 400 Mid Cap Value ETF (NYSEARCA:MDYV)

5-Yr Performance: 142%
S&P 500 5-Yr Performance: 117.3%
Net Assets: $75.1 million
TTM Distribution Yield: 1.4%
Beta: 1.24
Sharpe Ratio: 2.66
Standard Deviation: 11.3
Expense Ratio (Net): 0.28%

[/table]

Top 5 Holdings:

  1. HollyFrontier Corp (NYSE:HFC)
  2. SL Green Realty Corp (NYSE:SLG) REIT
  3. Realty Income Corp (NYSE:O) REIT
  4. Fidelity National Financial Inc (NYSE:FNF)
  5. New York Community Bancorp, Inc. (NYSE:NYCB)

SLYV the best performing value fund

With a five-year return of 170%, SPDR S&P 600 Small Cap Value ETF (NYSEARCA:SLYV) is by far the best performer out of the four. However, due to SLYV’s small-cap holdings the value fund has the most volatile returns with a Sharpe ratio of 3.35. Still, one of the more attractive points of SLYV is its diversification. The fund has a basket of 450 holdings with each one accounting for less than 1% of total assets.

On the other hand, SPDR S&P 400 Mid Cap Value ETF (NYSEARCA:MDYV) offers the best returns with the lowest risk. MDYV has 293 holdings at present and HollyFrontier Corp (NYSE:HFC) is the largest, accounting for 1.28% of the value fund. Along with the holdings listed above, MDYV has a position in a number of reinsurance companies and is mainly overweight financials. With only $75 million in assets the fund is the smallest in this piece.

I should also point out that the Schwab U.S. Large-Cap Value ETF’s returns are somewhat misleading, as although the fund has underperformed the market, on a total return basis, with dividends reinvested the fund would have turned $10,000 invested at the end of 2009, to $17,934 at the end of 2013, a total return of 79.34%, beating the S&P 500’s over the same period.