Investing in the real estate sector adds stability to a portfolio, mainly because the volatility in property prices is far less than what is experienced by stocks. Hence, investors willing to hold long-term positions would do well to consider real estate mutual funds as they add stability and bring steady returns to a portfolio. This category of funds also offers superior protection against inflation and is a solid investment choice.
Below we share with you three best-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.
VALIC Company I Global Real Estate (VGREX – Free Report) maintains a diversified portfolio by investing its assets in equity securities of real estate and real estate-related companies. The fund invests around 75% of its assets in securities of foreign companies, including those based in emerging markets. VALIC Company I Global Real Estate has three-year annualized returns of 2.4%.
VGREX carries an expense ratio of 0.73% compared with the category average of 1.21%.
Fidelity Advisor Real Estate Income A (FRINX – Free Report) invests heavily in debt and mortgage-backed securities of real estate companies and preferred and common stocks of REITs. FRINX invests a bulk of its assets in securities of real estate companies and other real estate related investments. Fidelity Advisor Real Estate Income A has a three-year annualized return of 6%.
As of July 2018, FRINX held 547 issues, with 2.90% of its assets invested in Equity Lifestyle Properties Inc.
American Century Global Real Estate Investor (ARYVX – Free Report) invests a huge portion of its assets in securities that are issued by REITs and real estate companies. Although the fund invests mainly in developed markets, it may also invest in emerging markets. American Century Global Real Estate Investor has three-year annualized returns of 2.5%.
Steven R. Brown is one of the fund managers of ARYVX since 2011.
To view the Zacks Rank and past performance of all real estate funds, investors can click here to see the complete list of funds.
Want key mutual fund info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >>