Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the natural gas industry to prosper over time as the rising cost of oil makes gas more favorable, the First Trust ISE-Revere Natural Gas Index ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The gas ETF's expense ratio -- its annual fee -- is 0.60%. That's a bit higher than many ETFs, but also considerably lower than most mutual funds.
This ETF doesn't sport the most impressive performance over its relatively short life. On average, it has underperformed 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?
Many natural-gas-related companies didn't turn in pretty results over the past year -- partly due to low prices for natural gas. Still, they may well see their fortunes change in the coming years.
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.
If you're looking for potential stocks to tap into natural gas, you really must read The Motley Fool's special free report to learn about the one stock to own to benefit from a natural gas recovery.
Longtime Fool contributor Selena Maranjian, whom you can follow on Twitter @SelenaMaranjian, owns shares of Chesapeake Energy, but she holds no other position in any company mentioned. Click here to see her holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Chesapeake Energy. 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.