Opening your mutual fund statement at the end of the second quarter should be a lot less painful than it's been in years.

The broader market, after all, has shot up 11% since the end of March. The Nasdaq's done even better, rocketing 14%.

But after the glee subsides, you'll have to think about what this fund performance is telling you and what changes you should make to your investments -- if any.

Here's a sampling of what you might see when that statement arrives, and what you should do.

Compare, Compare, Compare

Performance is the only thing you'll really see when you rip open that account statement. It's valuable but easily misused. A fund that's up a lot over a short period of time isn't necessarily a good investment. And a fund that's down a lot may not be so bad.

The point is: You cannot look at this information in a vacuum. A good fund in an out-of-favor sector can be better going forward than a bad fund in a hot area.

First, you'll have to compare how your stock funds have done vs. broad-market benchmarks like the Dow, S&P 500 and Nasdaq. Then you can move on to examine how those funds have done against their peers.

Morningstar's Web site includes a simple performance ranking of all mutual fund categories for the past month, three months, year and so on. Click here to go to the performance ranking.

So you shouldn't expect a large-cap value fund to have kept up with, say, that tech fund you have leftover from the late '90s. Value stocks held up incredibly well in 2000 and 2001, when the rest of the market was collapsing. That corner of the market is up this year, but just not as much as riskier sectors like tech.

The ( LLPFX) Longleaf Partners Fund might be trailing the average tech fund this year, but it's still up 10.8% -- ranking near the top of mid-cap value funds. It also has a stellar long-term record.

There's no need to bail out of that value fund if it hasn't kept pace with other funds you own. In fact, that goes back to the very reason you should have your money spread across different types of funds: When one is weak or down, another should be up.

Up or Down Too Much

Even if a fund is lagging in its category, that alone is not reason enough to dump it. You have to find out why it's so weak and if this is a longer-term problem.

A fund might be underperforming in a category if it's safer than other funds like it. Look at the FMC Select fund -- a solid, lower-risk investment. Morningstar calls it an all-stock, mid-cap blend fund. But this fund does have about 17% of its money in bonds and a little bit in cash. So it would naturally trail a fund that has all of its assets in stocks when the market is racing higher.

On the flip side, if you bought a fund for its safety and it unexpectedly falls a lot over a quarter or two, that might be a good reason to get rid of it. A fund that suddenly craters might have too much money socked into too few stocks.

A fund can also be up too much. Say you bought a fund for its broad diversification and it has soared more than the average tech fund this year, then it's probably not as safe as you might think.

The Whole Shebang

You should also step back and look at all of your funds in a row. Do they all move in lock step? Sure, stock funds tend to move together. But you don't want to see roughly the same percentage gains on all of your funds. That says no diversification.