Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to add some big international companies to your portfolio, but don't have the time or expertise to hand-pick a few, the Vanguard Total International Stock Index ETF (NYSEMKT: VXUS) could save you a lot of trouble. Instead of trying to figure out which stocks will perform best, you can use this exchange-traded fund to invest in lots of big international companies simultaneously.

Why this ETF, and why big international companies?
It's smart to diversify your portfolio with some companies based outside the U.S., as they might bolster it when the U.S. market enters a slump. This ETF offers an easy and inexpensive way to do so with its tiny expense ratios (annual fee) of 0.14%. It offers a dividend yield of about 3%, too.

A closer look at some components
On your own you might not have selected BP plc (NYSE:BP) or Banco Santander, S.A. (NYSE:SAN) as big international companies for your portfolio, but this ETF recently counted them among its more-than-5,000 holdings.

Oil titan BP took a beating after the massive Gulf of Mexico Deepwater Horizon oil spill. It has racked up tens of billions of dollars in associated costs and the disaster's total price tag for BP is not yet known. That may seem like a reason to steer clear, but BP's stock price seems to be factoring in the risk of substantial additional costs. Many other worries can also be explained away. The company can absorb a drop in oil prices, should that happen, and instability in Iraq won't hamper it much, either, as Iraq contributes relatively little to its bottom line. (It's far more invested in Russia, which poses its own concerns.)

Meanwhile, BP still has a lot to recommend it. The company has been raising money by selling off noncore assets ($38 billion worth and counting) and focusing on those with the highest profit potential. (Remember, though, that in shrinking itself, BP is also arguably shrinking its growth potential.) It's not afraid of innovation, either, experimenting with drones to survey its properties in Alaska. It generates more than $20 billion in operating cash flow annually and offers a fat 4.4% dividend yield. Its forward P/E ratio is around seven, and its price-to-sales is below the industry average and its own five-year average.

The stock looks attractive to me at recent levels. It has a promising project portfolio and solid reserve-replacement ratios, too. It has also been rewarding shareholders with dividends and share buybacks.

Banco Santander
Banco Santander, based in Spain, offers an even fatter dividend, yielding 6.1% recently. There are reasons to worry, however: Its dividend, revenue, and net income have fluctuated a bit in recent years, with some of them dipping lately. Its share count has been rising strongly, which puts pressure on earnings per share (EPS). (On the other hand, free cash flow has surged, topping $8 billion.) Some expect a dividend cut in the near future, but even a 25% cut would leave the yield attractive, at 4.6%.

With all of Europe's recent woes and slow economic recovery, a big European bank might not seem too attractive, but this one offers considerable geographic diversification, with substantial operations in the faster-growing economies of Latin America and South America. (It bought GE Capital's Scandinavian consumer finance operations recently, too.) Bulls like that the bank is focused on traditional retail banking as opposed to higher-risk businesses such as investment banking.

With its forward P/E ratio near 11 and well below its five-year average of 14.8, Banco Santander's stock is appealing. The company's profitability seems to be improving, and it has strong growth prospects thanks to its presence in emerging markets.

The big picture
It makes sense to consider adding some big international companies to your portfolio. You can do so easily via an ETF. Alternatively, you might simply investigate its holdings and then cherry-pick from among them after doing some research on your own.