With all the new exchange-traded funds that have popped up lately, and the growth sweeping across many sectors and niches, it shouldn't really come as a surprise that an ETF focused on waste has now come to market. In early October 2006, Van Eck Global launched the Market Vectors Environmental Services ETF (AMEX:EVX). The fund holds a small number of concentrated investments in the fast-growing environmental-services industry, making it very susceptible to the risks of this sector.

EVX tracks the Amex Environmental Services Index, which is composed of publicly traded companies involved in the management, removal, and storage of consumer waste and industrial byproducts, and related environmental services. The index includes common stocks and American Depositary Receipts with a market cap above $100 million and currently consists of 24 securities with a roughly equal mix of small-, mid-, and large-capitalization environmental services companies. On a back-tested basis, the index delivered returns of 21.7%, 24.5%, and 15.3% over the past one, three, and five years, respectively.

EVX is not a diversified fund, and its largest top five holdings make up about 43% of its assets. The top stock holdings include Republic Services (NYSE:RSG) 10.15%, Waste Management (NYSE:WMI) 10.02%, Veolia Environnement (NYSE:VE) 9.89%, Suez SA (NYSE:SZE) 9.66%. More broadly, EVX has 36%, 33%, and 30% of its assets in small-, medium-, and large-cap stocks, respectively.

Turnover of the fund is expected to be below 30%, which helps to reduce the impact capital gains may have on a taxable account. Expenses are a relatively moderate 0.55%, so this isn't the most inexpensive ETF.

According to the fund's literature, Americans each generate more than 4 pounds of waste every day. That's a lot of trash, and it has to be taken care of to keep our consumer-oriented society running. Why not make money on someone else's dustbin deposits?

For investors interested in a waste pure play, EVX might be worth a look, but be aware of some of the risks involved before investing. Not only does the fund have a limited operating history, but the index is also newly created. There's not a lot of history to indicate how the fund might perform. In addition, the fund is very concentrated and has a limited number of holdings, making it potentially very volatile. Although waste management and environmental services are a growing area of the economy, the returns generated by back-testing the index may not be indicative of the fund's future performance. The saying "Waste not, want not" applies to resources like cash, and I'm not yet convinced that I should put my money at the mercy of waste.

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Fool contributor Zoe Van Schyndel does not own shares in any of the funds or companies mentioned in this article. The Motley Fool has a disclosure policy.