Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the agricultural industry to thrive over time as the world's population keeps growing, the Market Vectors Agribusiness ETF (NYSE: MOO), with its charming ticker symbol, could save you a lot of trouble. Instead of trying to figure out which companies will perform best, you can use this ETF to invest in lots of them simultaneously.

The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The Agribusiness ETF's expense ratio -- its annual fee -- is a relatively low 0.56%.

This ETF has lagged the S&P 500 a bit, on average, over the past three years, and it's ahead of it a bit 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 22%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.

What's in it?
Several agricultural companies had strong performances over the past year. Monsanto (NYSE: MON), for example, rose 14%. It has many detractors unhappy with its genetically modified seeds, pesticides, and herbicides, but its offerings remain in demand, as farmers want to maximize their output and thereby their profits. The company is expanding in Latin America, which will help it offset its seasonal slowdowns in North America.

Other companies didn't do as well last year but could see their fortunes change in years to come. Fertilizer companies fall in this category, with PotashCorp (NYSE: POT) off 18% and Mosaic (NYSE: MOS) down 27% over the past year. Both companies are members of a cartel that has secured long-term contracts with good pricing. They cut back production recently but are forecasting strong demand.

Farming equipment giant Deere (NYSE: DE) shed 10%, but it has been investing heavily in innovation and expanding into emerging markets. Troubles in Europe and North America's not-so-rapid economic recovery may be keeping Deere down a bit, but its future looks rosy.

The big picture
Demand for food is likely to stay with us -- and grow over time. 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.

Learn about the "5 ETFs That Could Soar in 2012." And if you're looking for some great investments beyond ETFs, consider these "12 Dividend Stocks for 2012."