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For investors looking to park their funds in the real estate sector, mutual funds are the most cheapest and convenient method. This category of funds also offers superior protection against inflation. The real estate sector has seen tough times recently but the presence of these investments generally adds stability to a portfolio. This is because the volatility in property prices is far less compared to the kind experienced by stocks. Adding such funds to a widely diversified portfolio would increase returns while reducing the associated risk significantly.
Below we will share with you 5 top rated real estate mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all real estate funds, investors can click here to see the complete list of funds.
Principal Real Estate Securities R2 ( PRENX - MF report ) invests heavily in equity securities of real estate companies. The fund also invests in real estate investment trusts and companies with significant real estate assets, such as paper, lumber hotel and entertainment firms. The real-estate mutual fund has a three year annualized return of 30.01%.
The real estate mutual fund has an expense ratio of 1.58% compared to a category average of 1.38%.
Franklin Real Estate Securities A ( FREEX - MF report ) seeks both current income and capital growth. Real estate investment trusts and companies which derive at least half of their revenues from operations in the real estate sector constitute its major investments. The real-estate mutual fund has a three year annualized return of 30.21%.
As of March 2012, this real estate mutual fund held 46 issues, with 11.46% of its total assets invested in Simon Property Group Inc.
Oppenheimer Real Estate A ( OREAX - MF report ) utilizes the majority of the fund’s assets to purchase equity securities, such as common stocks of companies form the real estate sector. It may also consider parking funds in real estate operating companies. The real-estate mutual fund has a three year annualized return of 30.36%.
Scott Westphal is the Fund Manager and he has been managing this real estate fund since 2002.
Goldman Sachs US Real Estate A ( GREAX - MF report ) seeks capital appreciation and dividend income. The fund utilizes a large proportion of its assets to purchase equity securities of companies from the real estate sector or those with linkages to the industry. The real-estate mutual fund has a three year annualized return of 32.31%.
The real estate mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.44% compared to a category average of 1.38%.
John Hancock Real Estate Securities ( JIREX - MF report ) invests a large proportion of its assets in equity securities issued by real estate investment trusts and companies. Not more than 10% of its assets may be invested in foreign firms. The real-estate mutual fund has a three year annualized return of 31.76%.
John F. Robertson is the Fund Manager and he has been managing this real estate fund since 2005.
To view the Zacks Rank and past performance of all real estate mutual funds, investors can click here to see the complete list of funds.
About Zacks Mutual Fund Rank
By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past but are also expected to outperform going forward. Learn more about the Zacks Mutual Fund Rank at http://www.zacks.com/funds.
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