Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the health-care industry to prosper over the long run as our global population grows and ages, the Health Care Select Sector SPDR ETF
The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The SPDR ETF's expense ratio -- its annual fee -- is a very low 0.18%. And it yields 2%, as well.
This ETF has performed reasonably well, beating the world market over the past three and five years, and slightly lagging it over the past decade. 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 7%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Plenty of health-care companies had strong performances over the past year. Abbott Labs
Meanwhile, Gilead, known best for its HIV treatments, has been expanding its scope, most notably into hepatitis treatments. Its revenue growth has been slowing, but it's the future that really counts, and Gilead has several promising treatments in the works. It's negotiating with possible partners over a hepatitis C drug, for example.
Pfizer
Other companies didn't do as well last year, but could see their fortunes change in the coming years. 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 any industry or group of companies -- and make investing in and profiting from it that much easier.
If you're looking for investments with huge potential, check out our special free report, "Discover the Next Rule-Breaking Multibagger." It profiles a promising stock in the health-care arena.