Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the metals and mining industry to thrive as the global economy recovers and starts growing at a brisker pace, the SPDR S&P Metals and Mining (NYSE: XME) 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 metals and mining ETF's expense ratio -- its annual fee -- is a low 0.35%.

This ETF has performed reasonably in its relatively short history. It underperformed the S&P over the past three years, but has outperformed it handily over the past five. 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 turnover rate of 43%, this fund isn't rejiggering its holdings quite as frantically and frequently as many funds do.

What's in it?
Several of this ETF's components made strong contributions to its performance over the past year. Rare-earth element miner Molycorp (NYSE: MCP) has nearly quadrupled in less than a year, but the fact that some insiders are selling shares of the company as it raises money via debt doesn't necessarily bode well. Cliffs Natural Resources (NYSE: CLF) has doubled over the past year and stands to benefit from continued growth of developing nations such as China and Brazil, as they'll need its iron ore and metallurgical coal.

Hecla Mining (NYSE: HL) advanced 70%, and the fact that its cost of silver production is actually negative has enthralled many investors. (It's negative because the company profits via byproduct metals such as lead, zinc, and… uh, gold.)

Other companies didn't add as much to the ETF's returns last year, but could have an effect in the years to come. Titanium Metals (NYSE: TIE), for example, dropped about 5%, but its fallen margins are inching back up, and demand for titanium is likely to increase as Boeing (NYSE: BA) and Airbus keep churning out airplanes. (Titanium has other uses, as well, of course.)

The big picture
Demand for metals 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 here to see her holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Titanium Metals. 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.