Get In While You Can

Monty Python famously urged us to always look on the bright side of life -- and now more than ever, that's good advice. Sure, the market's been gutted in the past year, but focusing on that huge drop in your portfolio may blind you this bear market's many advantages:

• Top-drawer stocks are now on sale.
• It's far easier and more affordable to buy a home.
• Those of us with jobs suddenly appreciate them a whole lot more.
• Economic turmoil helps strong companies rise above competitors, like Best Buy (NYSE:BBY) vanquishing Circuit City, or Rite Aid eating CVS Caremark (NYSE:CVS) and Walgreen's dust.
• The once-abysmal national savings rate is on the rise.
• Responsible lending is back in fashion.

As if that cavalcade of delights wasn't enough, the recession's given us one more gift worth celebrating: Many mutual funds that had long been closed to new investors are open once again.

The bigger they are...
Wondering why a fund might close its doors in the first place? Many funds never do -- which is not as good as it may sound. The bigger a fund gets, the more money it manages, and the harder it gets for that fund's managers to find worthwhile investments that will offer meaningful returns. Warren Buffett has famously warned investors that he can't reproduce the same results he earned back when he was managing millions, instead of billions.

When a fund starts getting too big for its britches, some managers will avoid this conundrum by closing their doors to new money. Existing shareholders keep their shares, but new investors can't buy in, ensuring that managers retain the freedom to invest where they like.

Why doesn't every fund follow this practice? Remember that fund managers keep collecting annual fees for every dollar they manage. More assets under their supervision means they stand to collect a larger eventual payday.

Ride that bandwagon
The better a fund performs, the faster it tends to draw in new money. Just one profile in a business magazine, singling out a particular fund as a top performer, can bring in millions or billions in new investments. The flip side's also true; if a fund posts poor returns, or gets bad press, investors can head for the exits en masse.

When a fund's a consistent loser, or its managers fail to inspire confidence, that sort of retreat can be prudent. But when the fund is down mainly because the whole market has panicked, it makes less sense. Still, billions of dollars were yanked from mutual funds over the past year -- ironically, during what may be the best investing opportunity of the past 35 years -- which forced many fund managers to sell some of their holdings to cover withdrawals.

As a result, many previously closed funds are looking for new money, and their once-locked doors are wide open.

We missed you! Who wants a hug?
Dozens of funds have reopened just in the last year or two. Just remember that they're not all created equal; do your homework before you make any investment, to ensure that your money's going somewhere worthwhile. And don't forget that many of the best funds around never closed in the first place.

Still, many of these newly reopened funds are no slouches:

Data: Morningstar.

During the past decade, the S&P 500 averaged roughly a 3.5% annual loss, making those returns look even better.

If you've ever turned away from a promising fund because its managers had barred the door, check back now. The same folks who once hung out the "closed" sign may now welcome you -- and your money -- with open arms.