Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the natural resources industry to thrive as the global economy picks up, the iShares S&P North American Natural Resources (NYSE: IGE) ETF could save you a lot of trouble. Instead of trying to figure out which companies will perform best, you can use this ETF to invest in several dozen of them simultaneously.

The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The Natural Resources ETF's expense ratio -- its annual fee -- is 0.48%, which is low compared to mutual funds, although not all that low for an ETF. It recently sported a 1.4% dividend yield, as well.

This ETF has performed reasonably well, beating the S&P 500 handily over the past one and five years, though losing to it over the past three. 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 an extremely low turnover rate of 7%, 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. Freeport McMoRan Copper & Gold (NYSE: FCX), up 48% over the past year, has delivered impressive earnings on price increases for copper, gold, and molybdenum. Halliburton (NYSE: HAL), up 77%, has been posting double-digit revenue growth and expects a boost as it returns to activities in the Gulf of Mexico. Transocean (NYSE: RIG), up 26%, has been bringing out-of-service rigs back into service to fill demand in Brazil and elsewhere. National Oilwell Varco (NYSE: NOV) advanced 87%, but it may have gotten ahead of itself for now, although it does sport a multibillion-dollar backlog of orders

Other companies didn't add as much to the Natural Resources ETF's returns last year, but could have an effect in the years to come. Cenovus Energy (NYSE: CVE) is up 18% over the past year, while Suncor (NYSE: SU) gained 14%. Both may profit by bringing Canadian oil to the U.S. via drilling Canadian oil sands. Cenovus also has large oil deposit assets of its own.

The big picture
Demand for natural resources, especially oil, isn't going away anytime soon. A well-chosen ETF can grant you instant diversification across the industry -- and make investing in and profiting from the sector 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 ."

Longtime Fool contributor Selena Maranjian holds no position in any company mentioned. Click hereto see her holdings and a short bio. The Motley Fool owns shares of Transocean. Motley Fool newsletter services have recommended buying shares of National Oilwell Varco. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.