In Q2, Gold Golden, Real Estate Real Good

The traditional bear market havens of gold and real estate fared best over the second quarter.

At the other end of the scale, over the period:

  • domestic stock funds were down 12%
  • international equity funds lost over 5%
  • domestic hybrid funds dropped 6%.

The technology fund and the communications fund categories disappointed investors yet again, each sliding 28% for quarter, Morningstar reported.


Precious-metals sector funds were the best-performing mutual fund group, surging by 14% over the quarter, bringing year-to-date gains to 54%, according to figures from Morningstar.

The sector also finished as the best mutual fund category in the first quarter of 2002 and for the full-year 2001, as investors, scared off by accounting and corporate governance fiascos, fled US stocks in droves.

According to the investment research firm, the best performing precious-metals funds over the quarter were:

  • US Global Investors World Precious Minerals, which gained 36%
  • US Global Investors Gold Shares, which surged by 24%
  • Van Eck Investors Gold, which increased 20%.

Prime Real Estate

The real estate fund category, which gained 4% over the period, was the only US equity fund group to finish the quarter on a positive note.
Some of the best-performing funds in this sector include:

  • Security Capital European Real Estate, which rose 14%
  • Morgan Stanley Institutional European Real Estate, which increased 13%
  • Alpine US Real Estate Equity, which was up 10%.