Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you want to invest in the overall economy in a balanced way, the ALPS Equal Sector Weight ETF
ETFs often sport lower expense ratios than their mutual fund cousins. This ETF's expense ratio -- its annual fee -- is a relatively low 0.54%.
It's too early to draw any conclusions about this ETF's performance, as it's very young, with just a couple years on the books. It has tracked the S&P 500 fairly closely over that time. As with most investments, 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 7%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
This ETF's components are actually other ETFs -- namely, nine sector-focused ones. What it does differently than many other ETFs is distribute its assets equally among the nine sectors, thus not ending up over- or under-weighted in any one.
Some of those sector ETFs have made strong contributions to its performance this year. The Utilities Sector SPDR
Other sectors didn't add as much to the ETF's returns this year, but could have an effect in the years to come. The Financial Sector SPDR
The big picture
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.