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Anyone invested in a value mutual fund last year knows it was the horribilis of all annuses; according to Morningstar the average large-cap value fund lost 38% in 2008. And the pain was even more severe for investors in some of value’s marquee mutual funds. Longleaf Partners lost 51% last year and Bill Miller’s Legg Mason Value Trust shed 55%.

As my colleague Penny Wang pointed out, the big losses from the supposedly lower-risk value style of investing caught plenty of investors by surprise.

Yet since the market hit its recent market low on March 6th, value funds have been showing signs of life once again, posting gains that sharply outpace the 33% rise in the S&P 500. Longleaf Partners is up 51% from early March through the end of last week, Legg Mason Value is up 50%, and Dodge & Cox Stock and Davis New York Venture, are up more than 40% from the market low after getting seriously whacked in 2008. To be sure, that still leaves the battered bunch of 2008 with plenty to make up. After losing 50% it takes a 100% gain to get back to where you once were.

But you have to start somewhere.

As Legg Mason’s Bill Miller put it in his first quarter commentary (dated April 27th”): “After three years where the market was dominated first by price momentum, and then by panic, we have found value has once again begun to matter, as it has done 70 to 80 percent of the time. Consistent with that, our portfolio has once again begun to outperform. As the U.S. and global economy stabilize, risk aversion should attenuate, and capital should begin to return to credit and equity markets. That should be good for valuation-based strategies, and I am confident our results will reflect the value inherent in our portfolio.”

Are you as confident that the value style is going to regain its long-term footing?

-- Carla Fried