Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to add a bunch of small-cap companies to your portfolio because of their great growth potential, the Guggenheim Russell 2000 Equal Weight ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The Guggenheim ETF's expense ratio -- its annual fee -- is a relatively low 0.44%. (The fund is fairly 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 doesn't have much of a performance to assess, as it's only a year or two old. It underperformed the S&P 500 in 2011 and is slightly ahead of it so far this year. 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 38%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Lots of small-cap companies had strong performances over the past year. Cal-Maine Foods
Other companies didn't do as well last year but could see their fortunes change in years to come. Alliance One International
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, whom you can follow on Twitter, holds no position in any company mentioned. Click here to see her holdings and a short bio. 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.