Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the health-care industry to thrive as our population ages, the Vanguard Health Care
ETFs often sport lower expense ratios than their mutual fund cousins. The Health Care ETF's expense ratio -- its annual fee -- is a low 0.24%.
This ETF has performed well, beating the S&P 500 handily over the past three and five years. As with most investments, though, we can't expect outstanding performances in every quarter or year. Investors with conviction need to wait for their holdings to deliver. With a low turnover rate of 10%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Several of this ETF's components made strong contributions to its performance over the past year. Pfizer
Other companies didn't add as much to the ETF's returns last year, but could have an effect in the years to come. Celgene
The big picture
Demand for health-care products and services isn't going away anytime soon. A well-chosen ETF can grant you instant diversification across the industry -- and make investing in and profiting from the sector that much easier.
ETFs can help you find the way to better investing results. To find some great ETF investing ideas, take a look at The Motley Fool's special free report, " 3 ETFs Set to Soar During the Recovery ."