Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the solar energy industry to thrive as we finally develop alternatives to oil and gas, the Guggenheim Solar ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The solar ETF's expense ratio -- its annual fee -- is 0.75%, which is a bit on the steep side for an ETF but still lower than many stock mutual funds.
This ETF has performed disappointingly so far over the past three 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 17%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Some of this ETF's components made strong contributions to its performance over the past year. GT Advanced Technologies
Other companies pulled the ETF's return down last year, but could have a positive effect in the years to come. Chinese wafer maker ReneSola
Yingli Green Energy
The big picture
Demand for solar energy is likely to grow … eventually. If you think solar energy's time is coming soon, consider a solar ETF like this one. 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. 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.