It’s popular to decry the surfeit of mutual funds. Defining your terms right, there are more funds than there are stocks to invest in a near absurdity.

This situation may prove unpleasant or even disastrous for fund companies. But I see little harm to individual investors, who have many ways to sort through the multitude.

To sort them myself, I used Bloomberg fund-screening software to identify U.S. mutual funds that met four criteria:

Up an average 20 percent a year or more in the past five years.

Up an average 15 percent or more in the past year.

Up an average 15 percent or more in the past three years.

A minimum investment of $10,000 or less.

Among thousands of funds, only six made the grade. Consistent performance has been tough because the market has changed so much in the past few years. Until 1999, growth stocks, especially technology and biotechnology, were all the rage. In 2000 and early 2001, value stocks were the leaders.

Here are the funds that met the criteria, listed in order of five-year total return: Wasatch Micro-Cap Fund, up an average of 32.6 percent a year; Olstein Financial Alert Fund, up 26.6 percent; Wasatch Core Growth Fund, up 25.3 percent; Pimco Renaissance Fund, up 23 percent; Dreyfus Midcap Value Fund, up 22.8 percent; and Royce Low-Priced Stock Fund, up 20 percent.

Small fund’s coup

I consider the results a coup for Wasatch Advisors Inc., a relatively small fund family. It charges no load, or up-front sales fee. However, it may charge a management fee of up to 2 percent a year, which is unusually high. It invests in small growth stocks, generally with a market value of $300 million or less.

Olstein Financial Alert Fund is managed by Robert Olstein of Olstein Funds in Purchase, N.Y. His portfolio as of March 30 was full of depressed semiconductor stocks, which I think is a smart strategy for investors who can ride out a rough period of a year or so.

Pimco Renaissance Fund is managed by John K. Schneider of Pimco Advisors LP in Newport Beach. He emphasizes depressed stocks that have turnaround potential.

Dreyfus Midcap Value Fund buys stocks between $400 million and $4 billion in market value that it considers underpriced. This fund is not my cup of tea, mainly because I disagree with its choice of ICN Pharmaceuticals Inc. its biggest position as of June 30.

ICN, of Costa Mesa, sells proprietary drugs, research chemicals and diagnostic products. Its chairman, Milan Panic, is a former prime minister of Yugoslavia. The Securities and Exchange Commission has accused him and two other ICN executives of profiting by selling ICN stock when they knew, but hadn’t disclosed, that the Food and Drug Administration had rejected the company’s application for approval to sell ribavirin for the treatment of hepatitis C.

The company says there was no wrongdoing and a trial is slated for 2003.

Common interests

The Royce Low-Priced Stock Fund is run by Whitney George of Royce & Associates Inc. in New York. It invests in stocks that it considers undervalued and that, for the most part, trade for $15 a share or less. Mr. George and I apparently think alike. I own shares in five of his largest 15 holdings. His whole portfolio has a strong small-cap value flavor.

I have banged the drum for smaller stocks in this column from time to time since May 1998. So it gives me pleasure to report that most of these six top performing funds are small- or mid-cap funds.

John Dorfman is a columnist for Bloomberg News.