TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.

Seven of the 10 best-performing closed-end funds in the second quarter targeted the real estate market. After four consecutive months of rising home sales, investors are betting the worst is over.

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Pending home sales, a leading economic indicator, rose 0.1% in May from April and 4.6% from a year earlier. Foreclosures drove prices down to dirt-cheap levels in some parts of the country, while low mortgage rates stoked buying. The National Association of Realtors' Housing Affordability Composite Index, which compares the median home price to median incomes, climbed to a record at the beginning of the second quarter.

The

Cohen & Steers Quality Income Realty Fund

(RQI) - Get Report

, the top-performing fund that targets property, doubled its value by investing in U.S. real estate investment trusts, or REITs. Among the fund's holdings,

Macerich

(MAC) - Get Report

nearly tripled its value as

U-Store-It Trust

( YSI) and

Host Hotels & Resorts

(HST) - Get Report

climbed more than 100%.

Shares of the

Cohen & Steers Worldwide Realty Income Fund

( RWF) also doubled. Nearly half of this fund's holdings are outside the U.S., with 7.2% in the U.K., 6.5% in Australia, 6.3% in Japan and 6.1% in Hong Kong. The fund benefited from gains of 100% or more in

Keppel Land

of Singapore and

ProLogis European Properties

of Luxembourg.

The emerging markets, especially Brazil, Russia, India and China, are expected to lead the world in economic growth during the next decade. Two funds that invest in India and one designed to track Russian companies made our list.

President Barack Obama's efforts to renew ties with Russia are boosting the outlook for direct investment in Russian companies by U.S. businesses. The

Templeton Russia and East European Fund

(TRF)

gained 86% in the second quarter, despite a 20% drop in June. The fund's biggest contributors included

CTC Media

(CTCM)

, which rose 159%;

Mechel

(MTL) - Get Report

, up 104%; and

Vimpel-Communications

(VIP)

, up 80%.

Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.