Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you want to invest in a basket of America's biggest companies, the PowerShares QQQ ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The PowerShares ETF's expense ratio -- its annual fee -- is a low 0.20%.
This ETF has performed well, beating the S&P 500, on average, over the past three, five, and 10 years. 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 low turnover rate of 29%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Plenty of Nasdaq 100 companies had strong performances over the past year. Celgene
Wireless chip and patent king Qualcomm
Other companies didn't do as well last year, but could see their fortunes change in the coming years. Chinese search giant Baidu
Meanwhile, Israel-based Teva Pharmaceuticals
The big picture
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.