Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the global materials industry to thrive as the world economies recover and building and growing activities heat up, the iShares S&P Global Materials ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The materials ETF's expense ratio -- its annual fee -- is a relatively low 0.48%.
This ETF has performed reasonably well, beating the S&P 500 over the past five years, though slightly underperforming it over the past three. 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 very low turnover rate of 4%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Several essential materials companies had strong performances over the past year. Monsanto
Other companies didn't do as well last year, but could see their fortunes change in the coming years. DuPont
Fertilizer giant PotashCorp
Freeport McMoRan Copper & Gold
The big picture
Demand for essential materials isn't going away anytime soon -- which is why they're dubbed "essential." 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.
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. The Motley Fool owns shares of Freeport-McMoRan Copper & Gold. Motley Fool newsletter services have recommended buying shares of PotashCorp. Motley Fool newsletter services have recommended creating a modified stock repair against synthetic long position in Monsanto. The Motley Fool has a disclosure policy.