Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the health-care industry to thrive as our global population not only grows but also lives longer and develops more health-care needs, then the SPDR S&P Health Care Equipment ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The SPDR ETF's expense ratio -- its annual fee -- is a relatively low 0.35%. The fund is very 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 is too young to have a meaningful track record to assess. And regardless, as with most investments, 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 21%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Several health care equipment companies had strong performances over the past year. Intuitive Surgical
Other companies didn't do as well last year, but could see their fortunes change in the coming years. Edwards Lifesciences
The big picture
Demand for health care equipment isn't going away anytime soon. 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.
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Longtime Fool contributor Selena Maranjian, whom you can follow on Twitter, owns shares of Intuitive Surgical, Johnson & Johnson, and MAKO Surgical, but she holds no other position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of MAKO Surgical, Johnson & Johnson, and Intuitive Surgical. Motley Fool newsletter services have recommended buying shares of MAKO Surgical, Johnson & Johnson, and Intuitive Surgical, as well as creating a diagonal call position in Johnson & Johnson. The Motley Fool has a disclosure policy.
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