Stock Fund Returns Slumped In Feb. Most Bond Funds Gained Gold, natural resources and real estate funds buck broader downward trend.(MUTUAL FUNDS)

Byline: CLAIRE MENCKE

Most stock funds lost ground again in February. Investors continued to avoid sectors and companies that raised concerns about earnings prospects or accounting practices.

Meanwhile, fixed-income funds kept on gaining, in large part due to the clouds over equities.

Real estate and natural resources funds posted the only sectorwide gains among stock funds for the latest month, according to preliminary data from Lipper Inc.

Real estate funds gained steadily over much of the past year. They returned 2.1% on average for the month through Tuesday.

But recently, investors' focus has shifted somewhat to the price appreciation side of real estate stocks, said Robert Steers. He's chairman of Cohen & Steers and co-manager of several funds, including $32 million Cohen & Steers Special Equity Fund. The fund returned 4.4% for the month through Feb. 26.

"In 2001, the best (real estate) performers were the higher-yield ones," Steers said. But "now we're starting to see the growth names stop underperforming," he said. If the economy is recovering now, this beaten-down part of the real estate sector should produce better results, Steers said.