Commodities are a risky, yet extremely popular investment vehicle nowadays.

Motley Fool's Selena Maranjian quotes The Wall Street Journal, which describes investment in commodities and financial futures as "as extreme as you can get on the risk scale."

Sure, the Oppenheimer commodity-based fund has returned around 20% or more annually over the last four years. But who remembers the years before that – when it was dropping 30% and almost 50%?

Says Maranjian: "Investors are drawn to commodities because of the great leverage available. You can sometimes buy items by paying only about 10 percent of their value.

"In an extreme example, if you buy $50,000 of pork bellies for $5,000 and they double in value, you've made a lot of money by investing just a little. Of course, if pork bellies fall in value, you can lose your entire invested amount – and then some!"

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Historically, investors with limited means have generally never bothered with commodities, since "you typically can't get involved with small sums," writes Maranjian.

At least that was until the first commodity-based ETF was recently launched. The Deutsche Bank Commodity Index Tracking Fund contains "futures contracts tied to various commodities, in the following approximate proportions: oil, 55%; aluminum, 12.5%; corn and wheat, 11.25% each; and gold, 10%." The fund excludes many other classic commodities as well.

This new commodity ETF was spawned after the market again heated up recently.

Consider this: "Compared with the S&P 500's gain of about 5% last year, the Dow Jones AIG Commodity Index rose some 21%," according to the Motley Fool's report.

The idea behind such an index is that as the cost of raw materials rises, producers will shoulder the burden. But by investing in raw materials, one can actually benefit from the inflation.

But beware, says Maranjian.

"Remember also how volatile many commodities are. The price of oil, for example, has certainly demonstrated that. And if it falls, it will take much of this ETF with it."

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