Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the pharmaceutical industry to thrive over time as our global population grows and ages, the iShares Dow Jones US Pharmaceuticals ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The iShares ETF's expense ratio -- its annual fee -- is a relatively low 0.47%.
This ETF has performed rather well, beating the world market handily over the past three and five 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 18%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
More than a handful of pharmaceutical companies had strong performances over the past year. VIVUS
Botox maker Allergan
Other companies didn't do as well last year, but could see their fortunes change in the coming years. As of a few days ago, Questcor Pharmaceuticals
The big picture
Demand for medications 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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