Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to add some defensive consumer-staples stocks to your portfolio to serve as ballast in the event of a market downturn, the Consumer Staples Select Sector SPDR (NYSE: XLP) 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 lots of them simultaneously.

The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The staples ETF's expense ratio -- its annual fee -- is a very low 0.18%. It recently yielded 2.6%, too.

This ETF has outperformed 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 4%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.

What's in it?
More than a handful of consumer-staples stocks had strong performances over the past year. You might not expect heady appreciation from an old, established candy company, but Hershey (NYSE: HSY) surged 30%. Its revenue and earnings have been growing in recent years and even accelerating, but some worry about its free cash flow, which lags its peers. Like other food companies, Hershey is vulnerable to food-price volatility, and the price of cocoa has jumped over the past year. The company is also taking steps to address child-labor concerns with its suppliers.

Drugstore giant CVS Caremark (NYSE: CVS) gained 27%, benefiting from the struggles of rival Walgreen, which spent much of the past year in a money-losing rift with Express Scripts. Although Walgreen and Express Scripts reconciled, CVS's acquisition of the Medicare prescription-drug business from Universal American bodes well for future performance. Obamacare legislation's expansion of Medicaid can also help CVS, along with the Aetna purchase of Coventry Healthcare, since CVS provides pharmacy benefits management services for Aetna.

Procter & Gamble (NYSE: PG) rose 13%. With its dividend yield near 3.3% recently, and more than 50% of revenue coming from abroad, it's a diversified long-term winner with lots of blockbuster brands. It even stands out as a socially responsible company. One of its new initiatives is introducing some premium products, though it remains to be seen how well they're received. But on the downside, it carries a lot of debt and doesn't appear to be very undervalued at the moment.

Other companies didn't do as well last year but could see their fortunes change in the coming years. Archer Daniels Midland (NYSE: ADM), for example, was roughly flat, punished to some degree by volatility in food prices, such as in corn and cocoa. Drought conditions in America's farm belt will probably make things worse. One boost to business in recent years has been the use of corn for ethanol, and the growing world population is also helpful.

The big picture
Demand for consumer staples, by definition, 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.

CVS Caremark and the stocks above have their merits, but they're not your only options. Learn about three smart long-term stock plays in the Fool's latest special report. It's yours for the taking and is absolutely free, but don't miss out -- read it today.