Specialized Funds: Real Estate
Specialized funds focus on nontraditional asset classes that allow you to potentially gain exposure to very narrow segments of the market or very specific investing methodologies.
Reasons to consider real estate funds
- Offer diversification beyond traditional stocks and bonds
- Act as a potential hedge against inflation due to the tendency of real estate values and rents to increase when inflation is increasing
- Are historically less correlated to other investments
Risks are inherent in all investments and real estate mutual funds are no different. Typical risks include market risk, interest rate risk, default risk of debt related investments, and a drop in real estate values.
Fidelity real estate focused funds
Fidelity's suite of real estate mutual funds includes five portfolios of differing investment strategies. They range from a passively managed real estate index fund to four actively managed portfolios invested in varying combinations of common stocks, bonds, preferred stocks, securities of real estate investment trusts (REITS) and commercial mortgage backed securities (CMBS).
|Fund Name||Objective||Typical Holdings|
|Fidelity Real Estate Investment Portfolio (FRESX)||Seeks above-average income and long-term capital growth, consistent with reasonable investment risk. May be appropriate for investors searching for a more balanced possibility for some income and fund value appreciation.||Common stocks|
|Spartan Real Estate Index Fund (FRXIX)||Seeks to provide investment results that correspond to the total return of equity REITs and other real estate-related investments.||Common stocks|
|Fidelity Real Estate Income Fund (FRIFX)||Seeks higher than average income and, as a secondary objective, the fund also seeks capital growth. May be appropriate for investors searching for income rather than fund value appreciation.||Common stocks, bonds, preferred stocks, CMBS|
|Fidelity International Real Estate Fund (FIREX)||Seeks capital appreciation.||Common stocks|
|Fidelity Select Construction and Housing Portfolio (FSHOX)||Seeks capital appreciation.||Common stocks|