Away From Home

There's one basic truth about real estate funds: You can buy the stocks cheaper on Wall Street than you can the homes on Main Street.

No matter what's happening on your block, home prices, availability and builders may be very different in other parts of the country--and the world. In the business since the mid-1980s, Samuel Lieber, portfolio manager of the Alpine U.S. Real Estate Equity Fund (EUEYX), knows this well. His fund is a top performer, with a five-year annualized total return of 27.57 percent through mid-April, according to Morningstar.

Keeping between 40 and 45 stocks in the portfolio, Lieber says his fund isn't for widows and orphans. He likes buying stocks when they are cheap and not necessarily in favor: At this writing, the portfolio had 36 percent of its assets invested in lodging stocks and 50 percent in housing ones. "Housing stocks are controversial right now," says Lieber. "After autos, they are the next cheapest sector in the S&P [500 Index]."

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Lieber contends that while the market is softening, it may not be as bad nationwide as it is in some areas. If he's wrong, he says, "I don't like standing in front of a train: If certain things in the economy are deteriorating, we'll switch and buy something else. After all, we follow 280 [domestic] stocks in various real estate sectors in the market."