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Regardless of how it has been politicized and spun over over the years, the vast majority of the scientific community agrees that climate change can no longer be ignored. Most of the time, all we can do is try to prepare for contingencies, but the devastating effects that will be wrought by this worldwide phenomenon are a near certainty. Global water technology firm Xylem Inc. (NYSE:XYL) stands out as a clear leader in innovation and sustainable solutions. Their mission statement is: "Let's solve water." Truer words have never been spoken.
As an investment opportunity, there are multiple ways to approach climate change. Your portfolio could, for instance, revolve around renewable energy, electric vehicles, agriculture (Indigo Ag will be an IPO to put on your watch list), HVAC systems, waste removal, and even pest control. To my way of thinking, though, water is your best bet. Based on findings by the United Nations Office for Disaster Risk Reduction, 90% of all natural disasters are water related.
Along with global temperatures and sea levels, natural disasters are also on the rise. That is no coincidence. Essentially, we'll be waging a two-front war against flooding and droughts. In some regions, we'll have far too much water. In others, we won't have nearly enough. To be clear, my investment thesis is not about our environmental chickens coming home to roost, nor is it looking to assign blame. Rather, it is seeking to find viable solutions to a wide range of problems that will only intensify in scope and scale.
