NEW YORK (CNNfn) - Real estate fund manager Mike Winer lives by the rule "safe and cheap," and lately it has been paying off on the performance charts.
Winer's Third Avenue Real Estate Value Fund is up 5.8 percent year to date as of Monday, putting it first in its category, he said. Real estate funds were also one of the best categories for the week ended March 17, earning an average of 3.47 percent, according to Morningstar.
"For real estate, it's easy to determine 'safe and cheap,' " Winer said. "A lot of companies in the portfolio have gone up in the last couple of weeks."
Also in this column: Internet funds had a bad week; and a financial fund manager talks about the recent upswing in his sector on CNNfn.
A lot has changed on Wall Street in the last few weeks. The Dow soared nearly 500 points on March 16, while the Nasdaq has been on a downward spiral.
Besides real estate funds, other winners for the week ended March 17 include some battered names. At the top of the list are financial funds, with average returns of 12 percent; and large value funds, up 5.87 percent, according to Morningstar.
But small growth funds, which are heavy in tech names, were the worst performers, off 6.25 percent, while technology funds were next with losses of 5.95 percent in the same time.
"A lot of value-type stocks are finally getting recognized," Winer said. "Maybe there's some profit-taking in the high-tech sector, and investors are looking for safe bargains."
Winer said his fund is not, like others in the category, a REIT fund. A Real Estate Investment Trust, or REIT, is a compnay that manages real estate investments and distributes at least 95 percent of its earnings to shareholders annually. While his fund owns 30 percent REITS, most of the portfolio is in real estate operating companies.
"They (operating companies) are better financed, better able to grow, and they don't need to continually access external capital to complete acquisition plans," Winer said.
Top holdings include Forest City Enterprises (FCEA: Research, Estimates), St. Joe Co. (JOE: Research, Estimates) and Catellus Development (CDS: Research, Estimates).
"These are all companies with excellent long-term prospects," Winer said. "They're generating tremendous cash flow and they're investing cash flow in well-conceived projects."
Out of about 100 real estate funds, all but a handful invest exclusively in REITs, Winer said.
The REITs that are in his fund are trading at a substantial discount to their net asset value and are good candidates for takeover, liquidation or merger, Winer said.
For example, one of the largest holdings is small-cap REIT Imperial Credit Commercial Mortgage Investment Corp. (ICMI: Research, Estimates), he said. On Monday, shareholders of Imperial Credit approved a merger with a subsidiary of Imperial Credit Industries (ICII: Research, Estimates).
"It went from a terrific value investment to a terrific arbitrage," Winer said.
Internet funds were also big losers for the week ended March 17, according to Morningstar. Jacob Internet Fund was off by 11.34 percent for the week, while Enterprise Internet Fund gave up 9.92 percent and WWW Internet Fund lost 9.82 percent.
Ryan Jacob, manager of the Jacob Internet Fund, said in recent comments that despite his concerns with the "narrowness" of the market, he continues to have faith in the portfolio.
Tom Goggins, manager of the John Hancock Financial Industries Fund, said on CNNfn's Before Hours Tuesday that brokerage stocks, insurance stocks and a few regional bank stocks are doing well.
The fund, with $507 million in assets, is down 2 percent year to date as of Monday, putting it in the top quartile of its category, Goggins said.
Top holdings include Morgan Stanley (MWD: Research, Estimates), American Express (AXP: Research, Estimates), Merrill Lynch (MER: Research, Estimates) and AFLAC Inc. (AFL: Research, Estimates).
Goggins said financial stocks have been in a bear market for about 18 months because of investors' fascination with tech stocks, higher interest rates, and a lack of merger activity. 
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