Although some investors may be steering clear of commodities thanks to a recent price plunge and talk of new regulations on buying futures contracts, the exchange-traded funds still have their benefits.

Back in 2004, there was just one commodity exchange-traded fund, the SPDR Gold Shares (GLD). Now there are 87, with about $59 billion in assets, up from $36.3 billion at the end of 2008. Much of that growth is due to experts encouraging investors to own some commodities. They're a "natural fit" for those who worry about inflation, says Lane Jones, chief investment officer for Evensky & Katz, a money-management firm in Coral Gables, Fla.

Commodity ETFs typically made up of futures contracts, bundled together to trade as a single unit offer an efficient way to invest. Jones likes the iPath Dow Jones UBS Commodity Index Total Return ETN (DJP). The fund is technically a debt security called an exchange-traded note and offers some tax benefits over commodity ETFs, which can generate taxable income even if the fund loses money. It's also broadly diversified, with about a third of its holdings in energy.

Of course, when commodities crash, so do funds like DJP, which lost 39 percent last year. One fund avoided the bust: the Elements S&P Commodity Trends Indicator Total Return ETN (LSC). The fund owns sectors that have been moving up, assuming prices will keep rising, and bets against commodities with falling prices. Academic research suggests this momentum strategy ultimately beats the indexes, says Morningstar analyst Bradley Kay.

But this year it's down 12 percent, compared with a 6 percent gain for DJP. Even a commodities fund with brains can't always outsmart the market.