NEW YORK (CNN/Money) - Talk about stock market bummers. It's bad enough that you're losing a boatload of cash these days. It's even worse if you missed one of the few great opportunities to make money in the past two years -- real estate.

Funds that invest in the sector have earned 33 percent since 2000. The main index for real estate stocks is up 10 percent this year. The icing on the cake? A cushy dividend of around 7 percent.

It's enough to make any singed investor throw his nest egg into REITs, or real estate investment trusts. That, of course, would be a mistake - much as it was for the herds of retail investors who loaded up on tech stocks back in the day.

"It's always a good time to have assets in real estate," said Michael Winer, manager of Third Avenue Real Estate Value. "But if you try to time the market, chances are you're going to miss."

Low interest rates and a hearty economy have kept the commercial real estate market percolating. There are places in the country where things aren't so rosy -- apartment complexes in Atlanta, office buildings in San Francisco -- but overall, stocks that invest in real estate have held their value.

Winer continues to find promise in real estate operating companies (REOCs) such as Brookfield Properties, which owns and manages office properties and designs residential communities. The stock is up about 16 percent this year.

Another name in the Third Avenue fund, Modtech Holdings, designs modular classrooms and other temporary structures and is up about 40 percent. The fund, with about $324 million in assets, is up 3.8 percent as of July 11, according to Morningstar.

By contrast, Fidelity Real Estate Investment keeps about 85 percent of its assets in Real Estate Investment Trusts (REITs), which are corporations that use the pooled money of many investors to buy into mortgages and commercial properties. REITs offer steady returns and hefty payouts in the form of dividends, since they are required by law to distribute at least 90 percent of their earnings to shareholders each year.

(REITs and REOCs do the same thing, but since REOCs pay federal taxes, the dividends are much lower).

Steven Buller, manager of the Fidelity fund, said he remains overweighted in commercial malls. Same-store sales may be flat, but occupancy rates are high and American shoppers continue to be open-minded to new store concepts. Buller has also been adding to his weighting in hotels. While the hotel business suffered mightily after the Sept. 11 terrorist attacks, the sector rebounded 20 percent since March, he said.

Office buildings, malls and strip-shopping centers are less risky than other commercial real estate because the leases are generally long-term. At the other end of the spectrum, hotels are considered the most risky, since guests often leave after a single night.

While Fidelity does not discuss specific stocks, and last released holdings for the fund as of Dec. 31, 2001, Buller said his fund mirrors the Wilshire Real Estate Securities Index, which includes both REITs and REOCs. The Fidelity fund, with $1.7 billion in assets, is up 6 percent this year, Morningstar said.

Compare all those healthy numbers to the Dow, which has backpedaled to below 8,800, or the Nasdaq, which is hovering near a five-year low. It makes the real estate sector look like a goldmine. Many people who have watched REIT stocks climb in the past two years are even wondering if they're seeing a bubble about to burst.

Few who follow real estate stocks could forget the fallout after the last boom market came to a halt in the late 1980s. Vacancy rates and property values plummeted. But Buller thinks this time is different. Back then, the real estate sector went into recession with a glut of properties. This time, real estate went into recession in healthy shape.

Another key difference, he notes, is that real estate companies were highly leveraged in the late 1980s. This time, they learned their lesson and kept debt in check. They've also made operational reforms so you're less likely to see the kind of accounting shenanigans that plagues other corporations today.

Michael Grupe, senior vice president of the National Association of Real Estate Investment Trusts, also pointed out that the price-earnings ratio of REIT stocks is around 15 or 16. That's still lower than the battered S&P, which is around 20.

That said, the last thing you should do is find a real estate fund to park your money for the next six months. In the past week alone, REITs have fallen 5 percent -- which is still not quite as hard as the overall market. If your total return suffers even more in the months ahead, the 7 percent yield will seem like cold comfort.

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Plus, real estate managers insist their sector is for long-term players. Winer's investment horizon is three to five years -- he doesn't focus on short-term rises or falls.

And Buller, for his part, points out that the 10-year annualized return for his fund as of June 30 was 12.4 percent, compared with 11.4 percent for the S&P 500.

"Real estate is a long-term asset," Buller said.