Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the engineering and construction industry to thrive over time as the global economy eventually heats up and demand for building materials and services increases, the First Trust ISE Global Engineering and Construction Index ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The First Trust ETF's expense ratio -- its annual fee -- is 0.70%, which is higher than many ETFs, but also lower than the typical stock mutual fund. The fund is very small, too, so if you're thinking of buying, beware of potentially large spreads between its bid and ask prices. Consider using a limit order if you want to buy in.
This ETF hasn't performed too impressively in its relatively short life, but then it has lived during a global slowdown. It underperformed the world market over the past three years. 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 22%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
Few engineering and construction companies had strong performances over the past year. Chicago Bridge & Iron
Other companies did even more poorly over the last year, but could see their fortunes change in the coming years. Fluor
The big picture
Long-term demand for engineering and construction services 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, holds no position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of Fluor. The Motley Fool has a disclosure policy.