Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to add some bonds to your portfolio but are dismayed by the low yields of Treasuries, consider higher-yielding corporate bonds. The PowerShares Fundamental Investment Grade Corporate Bond ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The PowerShares ETF's expense ratio -- its annual fee -- is a very low 0.22%.
This ETF doesn't have a track record to evaluate, though, as it's rather new. 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. The ETF is 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.
What's in it?
Lots of promising companies offer tempting bonds. A peek inside this ETF reveals some examples, many of which have seen their shares perform well lately.
Other companies didn't do as well last year but could see their fortunes change in years to come. Hartford Financial Services
Bank of New York Mellon
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.
Learn about four ETFs you can count on. And if you're looking for some great investments beyond ETFs, consider these five stocks growing their dividends by 20% per year.