One nagging question investors face is whether the market will be ready when they are. Doing your homework and saving your ducats are within your sphere of influence. But market volatility? Not so much.

Good thing, then, that there's a proven workaround: mutual funds.

That's right, mutual funds
Make no mistake: The vast majority of them are 10-foot-pole avoiders, pricey underachievers that no savvy investor would want to touch.

A select few, however, have what it takes to get the job done, and Motley Fool Champion Funds -- the investing service that I run point on -- is dedicated to finding them. We've been making monthly recommendations since March 2004, and all but four of our picks have made money for investors. Moreover, our biggest decliner -- a concentrated fund with a recent portfolio featuring the likes of Hess (NYSE:HES), Phelps Dodge (NYSE:PD), and Schlumberger (NYSE:SLB) -- is off by a whopping 6.7%.

How's that for keeping a lid on volatility?

Method or madness?
There's no great mystery to uncovering world-class mutual funds, but with more than 7,000 contenders vying for your hard-earned investment dollars, it pays to do your research. To get a jump-start on that front, consider the following ways of whittling down your list of prospects:

  • Focus on funds with managers that have public track records of at least five years, and preferably longer. On its own a fund's performance history doesn't tell you a thing -- it's the manager's track record that matters.
  • Avoid funds with luxury-item expense ratios. A fund's expense ratio comes straight out of your returns, and counterintuitive though it seems, the less you pay, the better you'll likely do, performance-wise.
  • Favor out-of-favor areas of the market. Contrarian investing is key to taking advantage of market volatility, and thanks to their built-in diversification, high-quality mutual funds allow you to go against the grain while sleeping peacefully at night.

On that last point, I'm a big fan right now of large-cap stocks and the funds that invest in them. Thanks to their lengthy period of underperformance, the big boys' relative valuations look attractive in the aggregate and, at the level of certain individual companies, they look downright juicy.

When you have the likes of Wal-Mart (NYSE:WMT), Johnson & Johnson (NYSE:JNJ), Citigroup (NYSE:C), and McDonald's (NYSE:MCD) trading with price-to-earnings ratios that fall well below those of industry rivals and their own five-year averages, that's a good time to go big-game hunting.

The Foolish bottom line
Not coincidentally, each of the aforementioned appears in the lineup of our most recent Champion Funds recommendation, a fund that has smashed the market on the watch of a management duo that's worked together since January 2000. The price of admission is reasonable, too: While the typical mutual fund will ding you roughly 1.5%, this Champ costs less than 1%.

If you'd like to sneak a peek at this fine fund and all the others we've tapped, click here and a free Champion Funds guest pass is yours for the taking. Your pass is of the all-access variety and provides 30 days to peruse the service -- which includes model portfolios and members-only discussion boards, too -- and see if it's for you. I have a hunch that it is, but I'm biased, of course. Click here to see for yourself.

Fool contributor Shannon Zimmerman runs point on the Fool's Champion Funds newsletter service, and at the time of publication didn't own any of the securities mentioned above. Wal-Mart is an Inside Value recommendation. Johnson & Johnson is an Income Investor pick. You can check out the Fool's strict disclosure policy by clicking righthere.