Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the fertilizer industry to thrive as our global population grows and demands more food from farms, the Global X Fertilizers/Potash ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The fertilizer ETF's expense ratio -- its annual fee -- is 0.69%. That's a bit higher than the typical ETF's, but far lower than the typical stock mutual fund's. Note that the fund is fairly small, 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 enough of a track record to assess. Even so, 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.
What's in it?
Several fertilizer companies had strong performances over the past year. Terra Nitrogen
Other companies didn't do as well last year, but could see their fortunes change in the coming years. Agrium
The big picture
Demand for fertilizer 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.
Longtime Fool contributor Selena Maranjian, whom you can follow on Twitter, owns shares of Terra Nitrogen, but she holds no other position in any company mentioned. Click here to see her holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Potash of Saskatchewan. The Motley Fool has a disclosure policy.