REIT mutual fund is among the popular sector fund to invest in. This Real Estate fund can provide high dividend yield for investor regularly. The following is the 5 top performer REIT mutual funds include PIMCO Real Estate Real Return Strategy, Old Mutual Heitman REIT A, etc.
Intro
Investing in real estate is not difficult at all. Investor may invest directly in hard asset such as house or residential, rental property, commercial property, etc. Another way is to invest in Real Estate Investment Trust (REIT) mutual fund. The later strategy may be easier for any investor and it cost less to do it. REIT funds usually consist of variety of real estate company equities or stocks (mainly domestic and some foreign stocks). Rule of thumb is to have about 5% to 10% portfolio asset in REIT sector fund.
Note: You may also invest in REIT ETF (Exchange Traded Fund) or CEF (Closed End Fund). I’ll discuss more on these funds on my future articles.
Couple things may be attractive for investor to invest in these REIT funds are: the funds usually pay higher dividend to investor, the funds also will provide opportunity for long term capital appreciation, and the funds usually don’t have direct correlation to overall market movement.
The following Top Performing Real Estate REIT Mutual Funds is sorted based on its performance up to May 2011. The funds have been researched from various financial sources or magazines such as Morningstar, Yahoo finance, Kiplinger, SmartMoney, etc. Five Top Performing REIT Mutual Funds 2011:
Note: For fund performance, please check the table below.
1. PIMCO Real Estate Real Return Strategy A (PETAX)
The investment in PIMCO Real Estate Real Return Strategy is seeking for maximum real return consistent with prudent investment management. It mainly invests in real estate-linked derivative instruments backed by a portfolio of inflation-indexed securities and other Fixed-Income Instruments. The remaining 30% of total assets may be invested in securities denominated in foreign currencies; more than 30% in U.S. dollar denominated securities of foreign issuers and <10% of total assets in preferred stocks.
The last dividend distributed in March 2011 was 0.03%. Mihir Korah has managed this fund since December 2007. The fund inception date was on October 2003. The minimum balance to invest in this fund is $1,000 for brokerage account. Once you invest in this fund, you can add $50 increment into your initial investment. For IRA account or 401k account, please check you’re your account administrator for details. As part of load fund, the management fee is 0.25% and sales load fee is 5.50%.
PETAX has returned 26.19% over the past one year and 5.61% over the past 5 years. During its 5 years of positive return, the highest fund performance was achieved in 2009 with 53.42%. And the lowest return so far was in 2008 with -47.29%. The other classes of this fund are Class B (Ticker: PETBX), Class C (Ticker: PETCX), Class D (Ticker: PETDX), Class I (Ticker: PRRSX) and Class P (Ticker: PETPX).
The fund has 1.19% annual expense ratio rate, which is a bit lower compared to the average in the category (1.45%). PETAX can be purchased from 78 brokerages include Vanguard, JP Morgan, Merrill Lynch, Schwab Retail, Edward Jones, Northwestern Mutual Inv Service, Scottrade Load, LPL SAM Eligible, etc.
PETAX recorded 863.0% annual holdings turnover as of May 2011 which is much higher compared to the average in its category (116.93%). The top sectors of this fund are Government Related (71%), net cash & equivalents (14%), non-US developed (6%), mortgage (2%), invest. grade credit (2%), high-yield credit (2%), emerging markets (2%) and others (1%).
2. ProFunds Real Estate Ultra Sector Investor (REPIX)
This ProFunds Real Estate Ultra Sector fund is part of leveraged mutual fund. Todd Johnson has managed this ProFunds fund since its inception in December 2008. To invest in this fund, you will need a minimum balance of $15,000 for brokerage and IRA account. Additional investment can be done with no minimum amount. This fund is a no load fund, this means there is no management fee and no sales load fee. REPIX has 1.72% of annual expense ratio rate.
This YTD performance of this fund is 17.91%. It has experienced 7 years with up performance and 3 years with down performance. The worst 1-year return was in 2008 with -64.95%. It has returned 29.24% over the past year and -9.49% over the past five years. Besides Class A, this fund has another C Class as well (Ticker: AFISX).
This fund can be purchased from 70 brokerages such as JP Morgan, Vanguard, T Rowe Price, DATALynx, Schwab Retail, Common Wealth PPS, TD Ameritrade Inc, Firstrade, etc.
3. Alpine Realty Income & Growth (AIGYX)
Alpine Realty Income & Growth fund’s main objective is to provide a high level of current income. Seeking for capital appreciation is the secondary objective of this fund. The majority of the assets are invested in the securities of issuers which (i) are principally engaged in the real estate industry, (ii) are principally engaged in real estate financing or (iii) control real estate assets with an aggregate estimated value equal to no less than 50% of such issuer assets.
One year after its inception in September 1999, Robert W. Gadsden has been the lead manager of this fund. The AIGYX fund requires a minimum of $1,000 to open a brokerage account with no minimum subsequent investment. This fund has no sales-load fee and no 12b1 fee. The last dividend distributed in March 2011 was 0.18%. It has 1.24% annual expense ratio.
You can buy this Alpine fund though brokerages networks such as E Trade Financial, JP Morgan, Vanguard, T Rowe Price, Schwab Retail, Raymond James WRAP Eligible, TD Ameritrade Inc, Common Wealth PPS, Fidelity Retail Funds Network, Daily Access Corporation RTC, etc.
AIGYX has returned 27.40% over the past one year, 0.81% over the past three years and 10.66% over the past ten years. The ratio of up compared to down years in term of return performance is 5:1. In 2009, the fund has its best 1-year total return with 47.57% total return. It YTD return is 15.15%.
The top holdings of Alpine Realty & Income Growth Fund as of March 2011 represent 41.19% of portfolio. They are Simon Property Group, Boston Properties, Vornado Realty Trust, SL Green Realty Corp, Alexandria Real Estate Equities, CBL & Associates Properties, Equity Residential, Entertainment Properties Trust, Public Storage and Digital Realty Trust Inc.
4. Old Mutual Heitman REIT A (OARTX)
This Old Mutual Heitman REIT fund seeks a high total return consistent with reasonable risk. The majority of its net assets investment is invested in equity securities of companies principally engaged in the real estate industry, including REITs. OARTX may as well invest in common and preferred stocks.
This OARTX fund has distributed 0.83% dividend this past year. Last dividend distributed in March 2011 was 0.01%. The expense ratio rate is 1.50% per year. The minimum initial investment to invest in the brokerage account of this fund is $2,500 and $2,000 for IRA account. There is no 12b1 fee applies but there is a sales load fee of 5.75%. This fund has returned 15.15% over the past year and 9.9% over the past decade. The best 1-year return was recorded in 2004 with 34.64% while the worst 1-year return was in 2008 with -39.78%.
You can also invest in other fund classes to get lower fees. The other class tickers of OARTX are OBRTX (Z Class) and OIHRX (Institutional Class).
The lead manager of this top performing fund is Michael K. Moran. He has managed this fund since October 2009. This fund can be bought from 69 brokerages include Td Ameritrade Inc, Scottrade Load, Fidelity Retail Funds Network, Common Wealth PPS, Raymond James, JP Morgan, Vanguard, etc. The fund has 182.26% of annual holdings turnover as of May 2011. The top holdings as of March 2011 are Simon Property Group, Avalonbay Communities Inc, Boston Properties Inc, Equity Residential Properties Trust, HCP Inc, Digital Realty Trust Inc, Public Storage Inc, Host Hotels & Resorts Inc, Vornado Realty Trust and Biomed Realty Trust Inc.
5. JPMorgan Realty Income A (Ticker: URTAX)
The JP Morgan Realty Income fund is looking for total investment return through capital appreciation and current income. About 80% of its net assets are invested in equity securities of real estate investment trusts, including those with small market capitalizations. This non-diversified fund may also invest up to 15% of its net assets in illiquid holdings.
This real estate mutual fund has been managed by Jason Ko since December 2009. The last dividend distributed in March 2011 was 0.05%. This fund is available to be purchased for the brokerage account and IRA account with the minimum investment of $1,000, with $25 minimum subsequent investment. There is 0.25% management fee and 5.25% sales load fee. The annual holdings turnover as of May 2011 is 133%, higher compared to the average in the category which is 117%.
URTAX has 1.36% of annual expense ratio rate. And it has returned 17.98% over the past one year and 11.01% over the past decade. The fund has 2-stars rating from Morningstar. It has 13.93% of year-to-date return. The best performance of this fund was in 2006 with 34.22% within its 4 years of positive return record. While the worst was in 2008 with -42.49% return within its 2 years of negative return. The other classes of URTAX are Class B (Ticker: URTBX), Class C (Ticker: URTCX), Class Institutional (Ticker: URTLX) and Class R-5 (Ticker: JRIRX).
The top ten holdings of this fund for the first quarter of 2011 are Simon Property Group Inc, HCP Inc, Boston Properties Inc, Equity Residential, Public Storage, Vornado Realty Trust, Host Hotels & Resorts Inc, Avalon Bay Communities Inc, ProLogis and Digital Realty Trust Inc.
Other Interesting REIT Funds in this list
13. DWS RREEF Real Estate Securities A (RRRAX)
The investment in DWS RREEF Real Estate Securities has the purpose of providing long-term capital appreciation and current income. It invests at least 80% of net assets in equity securities of REITs and real estate companies. This non-diversified fund may also invest in other types of equities, such as preferred or convertible stocks.
Starting February 2004, Jerry W. Ehlinger has been the lead manager of this fund. It has 1.06% annual expense ratio rate. Investor will need to provide $1,000 min initial investment for brokerage account and $500 for IRA account. It has 0.25% of 12b1 fee and 5.75% of front-end sales load fee.
The fund has returned 17.16% over the past year and 2.55% over the past five years. It receives 3-stars rating from Morningstar and currently has 13.10% YTD return. The best 1-year total return so far was 38.51% (in 2003) and the worst one was -39.34% (in 2008).
Investor can also invest in other fund classes to get lower fees. The other class tickers of RRRAX are RRRBX (B Class), RRRCX (C Class), RRRRX (Institutional Class), RRRSX (R Class) and RRREX (S Class).
There are 103 brokerages offered this DWS RREEF fund, such as JP Morgan, LPL SAM Eligible, Schwab Retail, Ameriprise Brokerage, Sterne, Agee & Leach Inc, Vanguard, Merrill Lynch, Edward Jones,etc. The portfolio composition of RRRAX are 22% in office sectors, 19% in apartments, 15% in regional malls, 12% in health care, 10% in retail, 8% in hotels, 7% in industrial and 7% in other sectors.
Disclosure: No Position
Other Top Performing Mutual Funds:
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| Top Performer REIT Equity Funds |
Investing in real estate is not difficult at all. Investor may invest directly in hard asset such as house or residential, rental property, commercial property, etc. Another way is to invest in Real Estate Investment Trust (REIT) mutual fund. The later strategy may be easier for any investor and it cost less to do it. REIT funds usually consist of variety of real estate company equities or stocks (mainly domestic and some foreign stocks). Rule of thumb is to have about 5% to 10% portfolio asset in REIT sector fund.
Note: You may also invest in REIT ETF (Exchange Traded Fund) or CEF (Closed End Fund). I’ll discuss more on these funds on my future articles.
Couple things may be attractive for investor to invest in these REIT funds are: the funds usually pay higher dividend to investor, the funds also will provide opportunity for long term capital appreciation, and the funds usually don’t have direct correlation to overall market movement.
The following Top Performing Real Estate REIT Mutual Funds is sorted based on its performance up to May 2011. The funds have been researched from various financial sources or magazines such as Morningstar, Yahoo finance, Kiplinger, SmartMoney, etc. Five Top Performing REIT Mutual Funds 2011:
- PIMCO Real Estate Real Return Strategy
- ProFunds Real Estate Ultra Sector
- Alpine Realty Income & Growth
- Old Mutual Heitman REIT A
- JP Morgan Realty Income A
Note: For fund performance, please check the table below.
1. PIMCO Real Estate Real Return Strategy A (PETAX)
The investment in PIMCO Real Estate Real Return Strategy is seeking for maximum real return consistent with prudent investment management. It mainly invests in real estate-linked derivative instruments backed by a portfolio of inflation-indexed securities and other Fixed-Income Instruments. The remaining 30% of total assets may be invested in securities denominated in foreign currencies; more than 30% in U.S. dollar denominated securities of foreign issuers and <10% of total assets in preferred stocks.
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| PETAX fund details |
PETAX has returned 26.19% over the past one year and 5.61% over the past 5 years. During its 5 years of positive return, the highest fund performance was achieved in 2009 with 53.42%. And the lowest return so far was in 2008 with -47.29%. The other classes of this fund are Class B (Ticker: PETBX), Class C (Ticker: PETCX), Class D (Ticker: PETDX), Class I (Ticker: PRRSX) and Class P (Ticker: PETPX).
The fund has 1.19% annual expense ratio rate, which is a bit lower compared to the average in the category (1.45%). PETAX can be purchased from 78 brokerages include Vanguard, JP Morgan, Merrill Lynch, Schwab Retail, Edward Jones, Northwestern Mutual Inv Service, Scottrade Load, LPL SAM Eligible, etc.
PETAX recorded 863.0% annual holdings turnover as of May 2011 which is much higher compared to the average in its category (116.93%). The top sectors of this fund are Government Related (71%), net cash & equivalents (14%), non-US developed (6%), mortgage (2%), invest. grade credit (2%), high-yield credit (2%), emerging markets (2%) and others (1%).
2. ProFunds Real Estate Ultra Sector Investor (REPIX)
This ProFunds Real Estate Ultra Sector fund is part of leveraged mutual fund. Todd Johnson has managed this ProFunds fund since its inception in December 2008. To invest in this fund, you will need a minimum balance of $15,000 for brokerage and IRA account. Additional investment can be done with no minimum amount. This fund is a no load fund, this means there is no management fee and no sales load fee. REPIX has 1.72% of annual expense ratio rate.
This YTD performance of this fund is 17.91%. It has experienced 7 years with up performance and 3 years with down performance. The worst 1-year return was in 2008 with -64.95%. It has returned 29.24% over the past year and -9.49% over the past five years. Besides Class A, this fund has another C Class as well (Ticker: AFISX).
This fund can be purchased from 70 brokerages such as JP Morgan, Vanguard, T Rowe Price, DATALynx, Schwab Retail, Common Wealth PPS, TD Ameritrade Inc, Firstrade, etc.
3. Alpine Realty Income & Growth (AIGYX)
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| AIGYX fund characteristics |
One year after its inception in September 1999, Robert W. Gadsden has been the lead manager of this fund. The AIGYX fund requires a minimum of $1,000 to open a brokerage account with no minimum subsequent investment. This fund has no sales-load fee and no 12b1 fee. The last dividend distributed in March 2011 was 0.18%. It has 1.24% annual expense ratio.
You can buy this Alpine fund though brokerages networks such as E Trade Financial, JP Morgan, Vanguard, T Rowe Price, Schwab Retail, Raymond James WRAP Eligible, TD Ameritrade Inc, Common Wealth PPS, Fidelity Retail Funds Network, Daily Access Corporation RTC, etc.
AIGYX has returned 27.40% over the past one year, 0.81% over the past three years and 10.66% over the past ten years. The ratio of up compared to down years in term of return performance is 5:1. In 2009, the fund has its best 1-year total return with 47.57% total return. It YTD return is 15.15%.
The top holdings of Alpine Realty & Income Growth Fund as of March 2011 represent 41.19% of portfolio. They are Simon Property Group, Boston Properties, Vornado Realty Trust, SL Green Realty Corp, Alexandria Real Estate Equities, CBL & Associates Properties, Equity Residential, Entertainment Properties Trust, Public Storage and Digital Realty Trust Inc.
4. Old Mutual Heitman REIT A (OARTX)
This Old Mutual Heitman REIT fund seeks a high total return consistent with reasonable risk. The majority of its net assets investment is invested in equity securities of companies principally engaged in the real estate industry, including REITs. OARTX may as well invest in common and preferred stocks.
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| Old Mutual Heitman REIT fund |
You can also invest in other fund classes to get lower fees. The other class tickers of OARTX are OBRTX (Z Class) and OIHRX (Institutional Class).
The lead manager of this top performing fund is Michael K. Moran. He has managed this fund since October 2009. This fund can be bought from 69 brokerages include Td Ameritrade Inc, Scottrade Load, Fidelity Retail Funds Network, Common Wealth PPS, Raymond James, JP Morgan, Vanguard, etc. The fund has 182.26% of annual holdings turnover as of May 2011. The top holdings as of March 2011 are Simon Property Group, Avalonbay Communities Inc, Boston Properties Inc, Equity Residential Properties Trust, HCP Inc, Digital Realty Trust Inc, Public Storage Inc, Host Hotels & Resorts Inc, Vornado Realty Trust and Biomed Realty Trust Inc.
5. JPMorgan Realty Income A (Ticker: URTAX)
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| JPMorgan Realty Income fund details |
This real estate mutual fund has been managed by Jason Ko since December 2009. The last dividend distributed in March 2011 was 0.05%. This fund is available to be purchased for the brokerage account and IRA account with the minimum investment of $1,000, with $25 minimum subsequent investment. There is 0.25% management fee and 5.25% sales load fee. The annual holdings turnover as of May 2011 is 133%, higher compared to the average in the category which is 117%.
URTAX has 1.36% of annual expense ratio rate. And it has returned 17.98% over the past one year and 11.01% over the past decade. The fund has 2-stars rating from Morningstar. It has 13.93% of year-to-date return. The best performance of this fund was in 2006 with 34.22% within its 4 years of positive return record. While the worst was in 2008 with -42.49% return within its 2 years of negative return. The other classes of URTAX are Class B (Ticker: URTBX), Class C (Ticker: URTCX), Class Institutional (Ticker: URTLX) and Class R-5 (Ticker: JRIRX).
The top ten holdings of this fund for the first quarter of 2011 are Simon Property Group Inc, HCP Inc, Boston Properties Inc, Equity Residential, Public Storage, Vornado Realty Trust, Host Hotels & Resorts Inc, Avalon Bay Communities Inc, ProLogis and Digital Realty Trust Inc.
Other Interesting REIT Funds in this list
13. DWS RREEF Real Estate Securities A (RRRAX)
The investment in DWS RREEF Real Estate Securities has the purpose of providing long-term capital appreciation and current income. It invests at least 80% of net assets in equity securities of REITs and real estate companies. This non-diversified fund may also invest in other types of equities, such as preferred or convertible stocks.
Starting February 2004, Jerry W. Ehlinger has been the lead manager of this fund. It has 1.06% annual expense ratio rate. Investor will need to provide $1,000 min initial investment for brokerage account and $500 for IRA account. It has 0.25% of 12b1 fee and 5.75% of front-end sales load fee.
The fund has returned 17.16% over the past year and 2.55% over the past five years. It receives 3-stars rating from Morningstar and currently has 13.10% YTD return. The best 1-year total return so far was 38.51% (in 2003) and the worst one was -39.34% (in 2008).
Investor can also invest in other fund classes to get lower fees. The other class tickers of RRRAX are RRRBX (B Class), RRRCX (C Class), RRRRX (Institutional Class), RRRSX (R Class) and RRREX (S Class).
There are 103 brokerages offered this DWS RREEF fund, such as JP Morgan, LPL SAM Eligible, Schwab Retail, Ameriprise Brokerage, Sterne, Agee & Leach Inc, Vanguard, Merrill Lynch, Edward Jones,etc. The portfolio composition of RRRAX are 22% in office sectors, 19% in apartments, 15% in regional malls, 12% in health care, 10% in retail, 8% in hotels, 7% in industrial and 7% in other sectors.
Disclosure: No Position
Other Top Performing Mutual Funds:
- Top 10 High Yield Bond Mutual Funds 2011: Pt 1
- Top Performer Moderate Allocation Funds of May 2011: Pt 1
Fund Performance
| No | Fund Description | YTD Return | 1 YR | 3 YR | 5 YR | 10 YR |
|---|---|---|---|---|---|---|
| 1 | PIMCO Real Estate Real Return Strategy A | 15.39% | 26.19% | 3.87% | 5.61% | N/A |
| 2 | ProFunds Real Estate Ultra Sector Investor | 13.32% | 29.24% | -13.26% | -9.49% | 4.98% |
| 3 | Alpine Realty Income & Growth | 12.96% | 27.40% | 0.81 | 0.64 | 10.66 |
| 4 | Old Mutual Heitman REIT A | 11.38% | 15.15% | -2.13% | -0.16% | 9.90% |
| 5 | JP Morgan Realty Income A | 11.26% | 17.89% | -1.22% | 1.52% | 11.01% |
| 6 | Phocas Real Estate | 11.06% | 20.59% | 4.10% | N/A | N/A |
| 7 | Managers Real Estate Securities | 10.74% | 24.49% | 4.94% | 5.48% | 12.59% |
| 8 | Oppenheimer Real Estate A | 10.65% | 15.46% | 0.37% | 2.25% | N/A |
| 9 | JH Funds2 Real Estate Secs 1 | 10.30% | 24.83% | 2.36% | 4.02% | N/A |
| 10 | Delaware REIT A | 10.24% | 15.52% | -0.47% | 2.06% | 9.82% |
| 11 | Virtus Real Estate Securities A | 10.24% | 16.27% | 0.32% | 2.15% | 12.24% |
| 12 | American Century Real Estate A | 10.23% | 15.82% | -3.28% | -0.06% | 10.16% |
| 13 | DWS RREEF Real Estate Sec A | 10.20% | 17.16% | 0.03% | 2.55% | 12.04% |
| 14 | Davis Real Estate A | 10.14% | 12.67% | -4.44% | -1.61% | 9.05% |
| 15 | Dunham Real Estate Stock A | 10.12% | 12.63% | 1.26% | 0.55% | N/A |
