Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you want to add some proven and profitable giants to your portfolio, perhaps to balance some small caps, the Vanguard Mega Cap 300 Index ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The Mega Cap ETF's expense ratio -- its annual fee -- is an ultra low 0.12%. (Vanguard is known for its low fees.)
This ETF hasn't performed spectacularly so far, but it's also very young, with just a few years on the books. It underperformed the S&P 500 by a smidge over the past three years and outperformed it by a smidge over the past 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 8%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Plenty of huge companies had strong performances over the past year. Apple
Philip Morris International
Other companies didn't do as well last year but could see their fortunes change in the coming years. Cisco Systems
Finally, General Electric
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.
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Longtime Fool contributor Selena Maranjian, whom you can follow on Twitter, owns shares of Apple, but she holds no other position in any company mentioned. Check out her holdings and a short bio. The Motley Fool owns shares of Cisco Systems and Apple. Motley Fool newsletter services have recommended buying shares of Philip Morris International and Apple, as well as creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.