After four years of rising share prices, experts may differ on the likely size and timing of the next bear market, but most agree that there will be choppier seas to negotiate in the coming months. So which funds are best placed to ride the storms without losing too much of investors’ profits?

Mark Dampier, of Hargreaves Lansdown, the asset manager, says the key is to pick funds with an experienced manager at the helm: “You want a grizzled veteran, rather than a fresh-faced youth. Someone who has seen only the good times in the stock market may not know what to do when the bad times come along.”

One fund that meets these requirements is the PSigma Income fund . As an equity income fund, it has an in-built element of stability thanks to its higher-yield and value-driven stock selection, but the real attraction for Mr Dampier is Bill Mott as manager. Mr Mott has more than 30 years’ experience of funds and is one of the safest pairs of hands in the business.

Another veteran of several bear markets who gets Mr Dampier’s seal of approval is Ashton Bradbury, who runs Old Mutual’s Select Mid Cap fund. Mr Bradbury is able to anticipate the twists and turns of the business cycle better than most and is already starting to put his money into more defensive stocks and sectors.

However, not all funds tipped to do well in periods of turmoil boast a veteran manager. Newton Higher Income fund gets the thumbs up from Brian Dennehy, of Dennehy Weller & Co, the IFA, even though Tineke Frikkee, the manager, is a comparatively youthful 40 and has only been at the helm for three years. The point here, says Mr Dennehy, is that Newton’s disciplined investment process provides investors with reassurance. The yield, currently 4 per cent, is guaranteed to stay higher than the market as a whole because any stock selected has to yield 15 per cent more than the index. A similar sell discipline applies if any stock held begins to yield less than the index. These rules apply irrespective of who is managing the fund, thus ensuring enviable continuity. And in the last bear market, when the stock market as a whole fell in 2000, 2001 and 2002, the Newton fund posted positive returns in both 2000 and 2001, and its 13.2 per cent loss in 2002 compared well against the 22.6 per cent loss on the FTSE all-share. In other words, investors in Newton Higher Income were well protected against the worst of the bear market.

One much newer fund tipped to do well in stormier times is Black Rock’s Absolute Alpha fund, launched in 2005. The fund, managed by Mark Lyttleton, is one of a handful that can sell stocks short, that is, make money when shares fall as well as rise. An early sign that it can beat the pack when shares fall came in the stock market correction of May 2006, when its price held steady while other funds fell by an average of 5 per cent.

But the champion at navigating funds through turbulence is Neil Woodford, of Invesco Perpetual. Mr Woodfords’s value-based style of stock selection meant that his Invesco Perpetual Income fund did even better than Newton Higher Income in the bear market. It returned 19.5 per cent and 2.2 per cent in 2000 and 2001, when the FTSE all-share lost 5.9 per cent and 13.2 per cent, and limited its loss in 2002 to 12 per cent, against the all-share’s 22.6 per cent.

Mick Gilligan, of Killik & Co, the stockbroker, says: “Neil Woodford is already positioned for the next down-turn. His moves into defensive sectors – tobacco, utilities – meant he not only survived the last bear market but made money and is well placed to do so again.”