Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to invest in a bunch of midsize companies because they tend to be more proven performers than small caps and can grow more rapidly than large caps, the Rydex Russell Mid Cap Equal Weight ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The Rydex ETF's expense ratio -- its annual fee -- is a relatively low 0.40%.
This ETF doesn't have much of a performance record yet, as it's still less than a year old. It's very small, too, so if you're thinking of buying, beware of occasionally large spreads between its bid and ask prices. You might want to just keep an eye on it as it matures a bit, or you might want to be an early investor. Remember that 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.
What's in it?
Several stocks that this ETF follows did very well over the past year. Whole Foods Market
Other companies didn't do as well but could bounce back in the years to come. SUPERVALU
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.
Longtime Fool contributor Selena Maranjian holds no position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of Clorox, Dean Foods, SUPERVALU, and Whole Foods Market. Motley Fool newsletter services have recommended buying shares of Whole Foods Market and buying calls in SUPERVALU. 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.