Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the materials industry to prosper as the global economy recovers and construction and infrastructure projects proliferate, the Vanguard Materials 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 0.19%. (Vanguard is known for very low fees.)
This ETF has performed rather well, beating the world market 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 14%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Recent years have been tough on many materials companies. Some had relatively strong performances over the past year. International Paper
Praxair
Other companies didn't do as well last year, but could see their fortunes change in the coming years. Cliffs Natural Resources
Fertilizer giant Mosaic
The big picture
Demand for materials 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.
Learn about The Only Investments You'll Ever Need. And if you're looking for some great investments beyond ETFs, consider The Least Dangerous Stocks in the Dow.