Mutual funds in defensive areas fare better in 3Q

With two sessions to go, the Dow Jones industrial average is down nearly 2 percent for the quarter. And the broader Standard & Poor's 500 index--the yardstick for evaluating many mutual funds--is down about 5 percent. The Nasdaq composite index, which holds many technology stocks, is down about 5 percent.

For the year to date, the Dow is down 16 percent, the S&P 500 is down 17 percent and the Nasdaq is down 18 percent.

With worries about the health of the economy traders wagered that value stocks would perform better than growth stocks. Growth funds invest in companies likely to increase earnings and revenue but often don't pay big dividends like value funds.

"Value came back into vogue," Roseen said. "People are going 'You know what? If it's going to be a rough time at least I'm going to get some dividends,'" he said.

Diversified U.S. stock funds showed negative returns of 6.34 percent for the quarter and 15.8 percent year to date. Sector equity funds had an overall negative return of 8.29 percent for the quarter and 14.9 percent year to date. World equity funds had a negative return of 15.5 percent for the period and 25.4 percent so far this year.