Investments in the real estate sector are expected to provide excellent protection against inflationary pressures. This is why they should necessarily be part of portfolios with a long term horizon and aid in diversification. Additionally, they lend stability to a portfolio, despite the difficult phase real estate has passed through recently. This is because the volatility in property prices is far less compared to the kind experienced by stocks over the longer term. Real estate funds offer a cost effective and convenient method of holding these investments.
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.
Oppenheimer Real Estate A (OREAX) 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 27.08%.
Scott Westphal is the Fund Manager and he has been managing this real estate fund since 2002.
Goldman Sachs US Real Estate A (GREAX) 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 29.53%.
As of March 2012, this real estate mutual fund held 41 issues, with 12.37% of its total assets invested in Simon Property Group Inc.
Principal Real Estate Securities R2 (PRENX) 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 27.19%.
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) 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 27.27%.
Wilson Magee is the Fund Manager and he has been managing this real estate fund since 2010.
John Hancock Real Estate Securities (JIREX) 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 28.62%.
The real estate mutual fund has an expense ratio of 0.79% compared to a category average of 1.38%.
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.
Read the analyst report on OREAX
Read the analyst report on GREAX
Read the analyst report on PRENX
Read the analyst report on FREEX
Read the analyst report on JIREX
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