Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to add some mid-cap companies to your portfolio, the SPDR S&P MidCap 400 ETF (NYSEMKT:MDY) 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 SPDR ETF's expense ratio -- its annual fee -- is a very low 0.25 %.

This ETF has performed excellently, surpassing the S&P 500 not only over the past three and five years, but also the past 10 and 15 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.

Why mid caps?
Mid caps can be wonderful additions to portfolios because they've proven themselves to some degree, having grown to mid-cap size, but they also still have a lot of room to grow -- before they become large caps.

Lots of mid-cap companies  had strong performances over the past year. Regeneron (NASDAQ:REGN) has more than tripled in value, thanks to its Eyelea, a successful treatment for macular degeneration. Better still, the drug has received approval in Europe as well. Regeneron also has other drugs, such as some for cancer that it's developing with partners.

Oil refiner and marketer HollyFrontier (NYSE:HFC) more than doubled in value, with some still seeing it as undervalued. It has benefited, as refiners do, from drops in oil prices that boost refinery margins. The company recently reported record earnings, up 15% over year-ago levels.

LKQ (NASDAQ:LKQ), meanwhile, surged 42% over the past year, primarily  providing replacement parts and systems for vehicle repairs in North America and Central America. It has grown its revenue and earnings by an annual average  of more than 25% over the past five years, but that's been largely via acquisitions , worrying some investors. (In its last quarter, total organic revenue growth was close to 2% , vs. 28% for growth via acquisitions.)

Vertex Pharmaceuticals (NASDAQ:VRTX) gained 37%. Some see it as a potential monster stock of the future, with its promising (but possibly problematic) cystic fibrosis treatment, Kalydeco. Meanwhile, its Hep C drug Incivek's sales have slumped a bit. It has lined up some possible partners  for combination formulas with its Hepatitis C drug VX-135, too. There have been rumors recently that Vertex might be interested in Sarepta Therapeutics (NASDAQ:SRPT) for its extremely promising muscular dystrophy drug Eteplirsen.

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, whom you can follow on Twitter, has no positions in the stocks mentioned above. The Motley Fool owns shares of Vertex Pharmaceuticals. Motley Fool newsletter services recommend LKQ and Vertex Pharmaceuticals. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.