Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect technology-oriented companies to thrive over time due to innovations and demands for increased efficiency, the iShares Dow Jones US Technology ETF
The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The iShares ETF's expense ratio -- its annual fee -- is a relatively low 0.47%.
This ETF has performed reasonably, beating the S&P 500 over the past five years, but lagging it a bit over the past 10. As with most investments, of course, we can't expect outstanding performances in every quarter or year. Investors with conviction need to wait for their holdings to deliver.
With a very low turnover rate of 8%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
As you'd expect, some growing tech stocks did well for the ETF recently. Intel
Qualcomm
Other companies haven't done as well lately but have plenty of future promise. Glass giant Corning
Cisco Systems
The big picture
Demand for technology isn't going away anytime soon. A well-chosen ETF can grant you instant diversification across any industry or group of companies -- and make investing in and profiting from it that much easier.
Learn about the 5 ETFs That Could Soar in 2012. And if you're looking for some great investments beyond ETFs, consider these 12 Dividend Stocks for 2012.