Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect natural resources companies around the world to perform well as global economies recover, developing economies build out their infrastructure, and energy demands increase, the SPDR S&P Global Natural Resources ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The natural resources ETF's expense ratio -- its annual fee -- is a relatively low 0.40%. The fund is fairly small, too, so if you're thinking of buying, beware of occasionally large spreads between its bid and ask prices. Consider using a limit order if you want to buy in.
This ETF doesn't have much of a performance history to evaluate, as it's very young. Still, it's the future that matters most, so think about how bullish you are on the prospects for natural-resource companies. Meanwhile, remember that as with most investments, we can't expect outstanding performances in every quarter or year. Investors with conviction need to wait for their holdings to deliver.
What's in it?
Several natural resources companies had strong performances over the past year. International Paper
Other companies didn't do as well last year, but could see their fortunes change in the coming years. Fertilizer giants PotashCorp
Meanwhile, Freeport McMoRan Copper & Gold
The big picture
Demand for natural resources 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.