Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect consumer discretionary companies to see their fortunes improve as the global economy recovers, the Vanguard Consumer Discretionary ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The Vanguard ETF's expense ratio -- its annual fee -- is a low 0.19%. (Vanguard is known for very low fees.)
This ETF has performed rather well, topping its benchmark handily over the past three and five 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 7%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Plenty of consumer discretionary companies had strong performances over the past year. Take travel specialist priceline.com
Las Vegas Sands
Other companies didn't do as well last year, but could see their fortunes change in the coming years. Ford
Strong vehicle sales will boost Johnson Controls
The big picture
Demand for consumer-discretionary companies isn't going away anytime soon -- it just fluctuates along with the health of the economy. 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.
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