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3 Real Estate Funds for Spectacular Returns

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For investors looking to park their money in the real-estate sector, mutual funds are the cheapest and most-convenient options. This category of funds also offers solid protection against inflation.

The real-estate sector recently saw tough times but the presence of this investment vehicle generally adds stability to a portfolio. This is because volatility in property prices is far less than the extent experienced by stocks. Adding such funds to a widely diversified portfolio would increase returns while significantly reducing the associated risk.

Below we share with you three top-ranked real estate mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of funds.

TIAA-CREF Real Estate Securities Fund Retirement Class (TRRSX - Free Report) seeks maximum total returns over the long run through growth of capital and current income. TRRSX invests a large chunk of its assets in companies primarily involved in operations related to the real estate domain. The fund may invest a maximum of 15% of its assets in securities issued by foreign entities. TRRSX has three-year annualized returns of 5.5%.

David Copp is one of the fund managers of TRRSX since 2005.

John Hancock Funds II Real Estate Securities Fund Class 1 (JIREX - Free Report) seeks appreciation of capital and income over the long term. JIREX invests primarily in equity securities of companies engaged in operations related to the real estate sector, which includes REITs. The fund invests in securities like common stocks, preferred stocks and convertible securities. It may invest a maximum of 10% of its assets in securities of companies domiciled outside the U.S. territory. JIREX has three-year annualized returns of 2.4%.

As of the end of March 2020, JIREX held 37 issues, with 9.35% of its assets invested in Equinix Inc.

Fidelity Real Estate Investment Portfolio (FRESX - Free Report) aims for better-than-average income and long-term capital appreciation. The fund invests the majority of its assets in companies primarily engaged in the real-estate industry and other real-estate-related investments. It mostly invests in common stocks. FRESX has returned 1.1% over the past three years.

FRESX carries an expense ratio of 0.74% compared with the category average of 1.20%.

To view the Zacks Rank and past performance of all real estate funds, investors can click here to see the complete list of funds.

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