For investors looking to park their money in the real-estate sector, mutual funds are the cheapest and most-convenient options. This category of funds also offers solid protection against inflation.

The real-estate sector recently saw tough times but the presence of this investment vehicle generally adds stability to a portfolio. This is because volatility in property prices is far less than the extent experienced by stocks. Adding such funds to a widely diversified portfolio would increase returns while significantly reducing the associated risk.

Below we share with you three top-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. 

TIAA-CREF Real Estate Securities Fund Retirement Class (TRRSX - Free Report) seeks maximum total returns over the long run through growth of capital and current income. TRRSX invests a large chunk of its assets in companies primarily involved in operations related to the real estate domain. The fund may invest a maximum of 15% of its assets in securities issued by foreign entities. TRRSX has three-year annualized returns of 7.1%.

David Copp is one of the fund managers of TRRSX since 2005.

Fidelity Real Estate Investment Portfolio (FRESX - Free Report) aims for better-than-average income and long-term capital appreciation. The fund invests the majority of its assets in companies primarily engaged in the real-estate industry and other real-estate-related investments. It mostly invests in common stocks. FRESX has returned 2.6% in the past three years.

As of the end of August 2020, FRESX held 40 issues, with 12.72% of its assets invested in Prologis Inc.

DWS RREEF Real Estate Securities Fund - Class A (RRRAX - Free Report) seeks long-term capital growth and current income. The fund invests the majority of its assets in equity securities of real estate investment trusts and real estate companies. RRRAX has three-year annualized returns of 3.8%.

RRRAX carries an expense ratio of 0.98% compared with the category average of 1.20%.