Well, mutual funds and stocks are similiar.
Stock is individual company and
Mutual funds are group of companies.
Therefore, Mutual funds are a smaller version of the whole industry. Its depends on fund's manager's experience to pickout some companies that make money and invest more in it or otherwise less.
For selecting mutual funds, I will first choose the industry that I am interested in and think they will keep growing for a while. Like, financial insitutions, and enery companies. Then you will go to each mutual fund company, like RBC, Aim Trimark, AGF, Franklin....etc to research their performance, management fees. So, I finanlly pick
1) RBC O'Shaugnessey International
2) RBC O'Shaugnessey US Small Cap
3) Energy
4) TD Dividend