Leading Funds Like Gold, Real Estate Goldcorp, REIT Chelsea Property are top buys, but Webster Financial is sold.(A)

Byline: JULIE HUYNH

The nation's top-performing funds are still reluctant to make big purchases. But they've made small buys in gold issues, such as Goldcorp, Harmony Gold and TVX Gold, in the latest reporting periods. REIT firm Chelsea Property was also a favorite of top funds.

Gold has been the place to be the past few years. The economy and the stock market were sputtering. But many gold stocks have been rocketing to new highs.

Dollar weakness, the threat of war with Iraq and low interest rates have lured investors into gold as a safe-haven asset.

In December, gold prices hit multiyear highs of $350 a troy ounce. It cost $278 at the start of 2002. The Metal Ores-Gold/Silver group ranked 4th among IBD's 197 industry groups going into Thursday.

Gold funds were the best-performing category in 2002, according to Lipper Inc. The group gained 62% through Dec. 26. Top gold portfolios in 2002 included $142 million First Eagle SoGen Fund, $35 million Monterey OCM Gold Fund, $84 million Gabelli Gold Fund and $144 million Tocqueville Gold Fund.

Despite gold's recent sex appeal, investors should remember that gold's long-term performance is grim. The group's 10-year average annual return was a puny 4.58% vs. diversified U.S. stock funds' 7.77%.