Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you expect the 30 stocks in the Dow, which represent some of our nation's biggest and most vital companies, to thrive over the long term, the SPDR Dow Jones Industrial Average ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The Dow ETF's expense ratio -- its annual fee -- is a very low 0.18%. (Dividend seekers will like its yield of roughly 2.7%.)
This ETF has performed reasonably well, beating the broader S&P 500 over the past three, five, and 10 years, on average. 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 0%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do. It only has to change its holdings when the 30 components of the Dow are rejiggered, which typically happens every few years.
What's in it?
Several of this ETF's components made strong contributions to its performance over the past year. Caterpillar
Other companies didn't add as much to the ETF's returns last year, but could have an effect in the years to come. Boeing
The big picture
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.
Longtime Fool contributor Selena Maranjian owns shares of 3M and Intel, but she holds no other position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of Intel. Motley Fool newsletter services have recommended buying shares of 3M and Intel. Motley Fool newsletter services have recommended creating a diagonal call position in Intel.
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