Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to invest in companies executing significant stock buybacks because you take that as a sign of bullishness from their managements, the PowerShares Buyback Achievers ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The Buyback ETF's expense ratio -- its annual fee -- is 0.60%. The ETF is relatively small, too, so if you're thinking of buying, beware of occasionally large spreads between its bid and ask prices. Consider using a limit order if you want to buy in.
This ETF has performed well, but it's also relatively young, with just a few years on the books. It outperformed the S&P 500, on average, over the past three and 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 low turnover rate of 26%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Several Buyback Achiever companies had strong performances over the past year. Amgen
Other companies didn't do as well last year, but could recover and perform better in the years to come. Walgreen
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.