Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the Chinese economy to keep thriving, the SPDR S&P China
ETFs often sport lower expense ratios than their mutual fund cousins. The China ETF's expense ratio -- its annual fee -- is 0.59%. That's low compared to most international mutual funds, but fairly high in the ETF universe.
This ETF has performed reasonably, but it's also very young, with just three full years on the books. It underperformed a broad international lindex in 2008 and blew past it in 2009, roughly coming up even in 2010. 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 25%, 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. SINA
Other companies didn't add as much to the ETF's returns last year, but could have an effect in the years to come. China Life Insurance
The big picture
China's growth won't stop 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 owns shares of Baidu, but she holds no other position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of China Mobile. Motley Fool newsletter services have recommended buying shares of China Mobile, Baidu, and Sina. 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.