Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the health-care industry to thrive over time as baby boomers get older and need more medical attention, and as the world's overall population grows and ages, the First Trust Health Care AlphaDEX ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The First Trust ETF's expense ratio -- its annual fee -- is 0.70%, which is a bit higher than many ETFs, but also considerably lower than the typical stock mutual fund.
This ETF has performed reasonably, but it's also very young, with just a few years on the books. It outperformed the S&P 500 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.
What's in it?
Several health-care companies have had strong performance over the past year. Intuitive Surgical
A longtime dividend powerhouse, Abbott Labs
Other companies didn't do as well last year, but could have an effect in the years to come. Hospital operator Tenet Healthcare
The big picture
Demand for health-care products and services 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.