After months of criticism, some mutual funds that magnify investors' bets on the direction of the stock market are being scaled back.

On Wednesday, Direxion Funds said its so-called "leveraged" mutual funds will double investors bets on the direction of the stock market on a monthly - rather than a daily - basis.

The change will apply only to Direxion's conventional mutual funds and not to its exchange-traded funds, which along with those from Bethesda, Md.-based ProShares ETFs, have provoked the most controversy.

-By Ian Salisbury, Dow Jones Newswires; 212-416-2241; ian.salisbury@dowjones.com