Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect biotech firms and companies specializing in genomics to thrive as advances in health care and medicine continue, the PowerShares Dynamic Biotech & Genome ETF (NYSE: PBE) 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 lots of them simultaneously.

The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The PowerShare ETF's expense ratio -- its annual fee -- is 0.63%. That's far from the least expensive ETF you can find, but it's also considerably cheaper than the typical stock mutual fund.

This ETF has a mixed performance record in its relatively short life. It underperformed the S&P 500 over the past three years, on average, and outperformed it by less than a percentage point over the past five 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 turnover rate of 81%, this fund isn't frantically and frequently rejiggering its holdings, as some funds do, but it still makes plenty of changes over the course of a year.

What's in it?
Several of this ETF's components made strong contributions to its performance over the past year. Food safety testing specialist Neogen (Nasdaq: NEOG) gained 7%, with investors excited about its expansion abroad, its marketing agreement with DuPont (NYSE: DD), and its upcoming new products. Onyx Pharmaceuticals (Nasdaq: ONXX) surged 31%, partly on good phase 3 trial results for its colorectal cancer treatment.

Regeneron Pharmaceuticals (Nasdaq: REGN), meanwhile, more than doubled, buoyed in part by poor results for a competitor's macular degeneration treatment.

Other companies didn't add as much to the ETF's returns last year, but could have an effect in the years to come. Neurocrine Biosciences (Nasdaq: NBIX) shed about 6%, as it develops, among other things, a treatment for tardive dyskinesia, an involuntary movement disorder. It's also infused with some cash from a deal with Abbott (NYSE: ABT) for the global rights to its endometriosis treatment.

The big picture
Demand for new medical treatments isn't going away anytime soon. A well-chosen ETF can grant you instant diversification across any industry or group of companies -- and make investing in and profiting from it that much easier.

Learn about the best dividend ETFs. And if you're looking for some great investments beyond ETFs, consider these 10 Stocks for Your Retirement Portfolio.