Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect technology-oriented companies, particularly in the software arena, to thrive over time as our technological needs and demands grow, then the iShares S&P North American Technology-Software Index ETF (NYSE: IGV) could save you a lot of trouble. Instead of trying to figure out which companies will perform best, you can use this ETF to invest in a lot of them simultaneously.

The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The iShares ETF's expense ratio -- its annual fee -- is a relatively low 0.48%.

This ETF has performed rather well, beating the world market over the past three, five, and 10 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 17%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.

What's in it?
Plenty of software companies had strong performances over the past year. Business software developer TIBCO Software (Nasdaq: TIBX), up 52%, has been posting double-digit (and increasing) growth rates for revenue and earnings, topping analyst estimates for 16 consecutive quarters. It's investing heavily in R&D and is poised to profit from the "big data" boom. Its CEO has been praised for aggressive hiring within the U.S. as well as for offering compelling benefits to employees.

Nuance Communications (Nasdaq: NUAN), up 43%, specializes in voice recognition technology, among other things, and has been benefiting from having components in a variety of popular iDevices (think Siri). Bulls are excited about the upcoming iPhone 5 and the revenue it can bring to Nuance, but bears worry about competition in speech recognition from AT&T and others.

Autodesk (Nasdaq: ADSK), up 32%, specializes in design software, and has its hand in the filmmaking industry as well as the nascent 3-D printing business. The company's 3-D modeling software, Autodesk Inventor Fusion, has just been added to the Mac App store. It also recently bought Socialcam, which some call the Instagram of video, but that has some worried that it will detract from Autodesk's successful focus.

Symantec (Nasdaq: SYMC), which specializes in security software, gained 14%. It hasn't been growing as rapidly as some of its peers, and while many of its bulls rejoiced when it got a new CEO recently, others think the company needs more than just a change at the top.

The big picture
Demand for software 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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