Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the insurance industry to thrive over time, the SPDR S&P Insurance ETF
The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The insurance ETF's expense ratio -- its annual fee -- is a relatively low 0.35%. The fund is fairly 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 has outperformed the world market over the past three years, but underperformed it over the past five. 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 9%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Several insurance companies had strong performances over the past year. Cincinnati Financial
Marsh & McLennan
Other companies didn't do as well last year, but could see their fortunes change in the coming years. Prudential
AFLAC
The big picture
Demand for insurance isn't going away anytime soon, because the risks we face aren't going away. 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.
Some of these insurers offer sizable dividend yields. For additional compelling portfolio candidates, check out our special free report, "Secure Your Future With 9 Rock-Solid Dividend Stocks." The report is 100% free, but it won't be around forever, so click here to access it now.