Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect large companies to keep growing, especially as our global economy eventually gets back on track, the Vanguard Mega Cap 300 Growth Index ETF
The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The Vanguard ETF's expense ratio -- its annual fee -- is a very low 0.13%.
This ETF has performed well, but it's also very young. In just three full years on the books, it's averaged 3.1% annually, vs. 1.1% for the S&P 500. 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 21%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Several of this ETF's components made strong contributions to its performance over the past year. Phillip Morris International gained about 34% this past year. Its volume hasn't been growing as briskly as many would want, but income has been growing well, partly because of price hikes. While the percentage of smokers in the U.S. has been shrinking, presenting issues for domestic Altria
Other companies didn't add as much to the ETF's returns last year, but could have an effect in the years to come. Cisco Systems
Ford
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.
ETFs can help you find the way to better investing results. To find some great ETF investing ideas, take a look at The Motley Fool's special free report, " 3 ETFs Set to Soar During the Recovery ."