Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you want to invest in socially responsible companies, the iShares MSCI USA ESG Select Social ETF
The fund tracks the MSCI USA ESG Select Social index, which screens for companies with good records on environmental, social, and governance, or ESG, issues relative to their peers and the overall market. It then weights them in the index according to how strong their scores are.
ETFs often sport lower expense ratios than their mutual fund cousins. The iShares ETF's expense ratio -- its annual fee -- is a relatively low 0.50%.
This ETF has performed reasonably well, beating the S&P 500 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 35%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Several of the companies that meet the ETF's standards have performed well over the past year. Spectra Energy
Other companies haven't done as well lately but could bounce back in the years to come. Japan-based insurer AFLAC
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. And socially responsible companies can be very profitable, too.
Longtime Fool contributor Selena Maranjian owns shares of Intel, but she holds no other position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of Intel and AFLAC. Motley Fool newsletter services have recommended buying shares of Intel, AFLAC, and Spectra Energy, as well as creating a bull call spread position in Intel. 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.