These Funds Domicile Homebuilders' Stocks

After President Obama pitched a plan to cut homeowners' mortgage insurance, a number of homebuilders' stocks climbed out of price consolidations.

Some of the top technical performers from the homebuilding industry are:

• Lennar Corporation LEN
• D.R. Horton, Inc. DHI
• PulteGroup, Inc. PHM
• Toll Brothers Inc TOL
• NVR, Inc. NVR

The housing industry only slightly lagged the large-cap U.S. indices in 2014, and some analysts are looking for even stronger performance this year.

There are not many mutual funds that focus specifically on the homebuilders, but investors who want exposure to that sub-sector may want to check out the Fidelity(R) Select Construction & Housing Portfolio FSHOX.

Related Link: Barron's Recap: Mutual Fund Quarterly

Fidelity(R) Select Construction & Housing Portfolio

The fund seeks to invest at least 80 percent of its assets in companies that design and build commercial, residential, industrial and government-financed facilities. It also invests in industry suppliers, and those involved in the sale and distribution of housing-related products and services.

Top holdings include:

• Home Depot Inc HD
• Lowe's Companies, Inc. LOW
• Essex Property Trust Inc ESS
• Aecom ACM
• Lennar

The fund has returned 18.5 percent in the past year. It has an expense ratio of 0.81 percent, not terribly pricey for an actively managed fund.

CGM Realty Fund

The CGM Realty Fund CGMRX typically holds only 20 or 25 stocks, and can invest up to 20 percent of its assets in outside the real-estate industry. The top three holdings are RLJ Lodging Trust RLJ, Jones Lang LaSalle Inc JLL and Morgan Stanley MS.

The fund is managed by Ken Heebner, well known as the manager of the CGM Focus Fund CGMFX, with $1.3 billion in assets.

Among homebuilders, Lennar constitutes 6.34 percent of the fund; Toll Brothers, 5.50 percent; D.R. Horton, 5.11 percent and Pulte Group, 4.93 percent.

The CGM Realty Fund returned 24.40 percent over the past year. Its expense ratio is 0.92 percent.