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Investing in Water and Water ETFs

Nov. 26, 2007 10:10 AM ETPHO, PIO, CGW, FIW15 Comments
Brian Powers profile picture
Brian Powers

To start with, I want to say that I own the PowerShares Water Resources Portfolio ETF (PHO). In this post I will explain why I invest in water and why PHO is my security of choice. The links for all sources noted are at the bottom of this post and should provide a bit of a linkfest for those looking to do further research.

Water is, of course, a necessity. It is a fundamental need to sustain all life on this planet. The earth is 70.8% covered by water on its surface. Only about 2.5% of that is fresh water, 68.7% of which is currently in the form of ice (source: Wikipedia).

I grew up and live in New York State where I have enjoyed excellent water quality and sanitation services throughout my life for all of my daily needs. I am lucky and I do not take it for granted.
I have been researching the state of global fresh water for many years and been fascinated by many of the numbers. The need for adequate water supply is not just a concern for the future, but for this very day in many parts of the world:

  • 1 billion people do not have access to safe drinking water
  • 2.6 billion people lack basic sanitation
  • 2.2 million people a year die from illness caused by contaminated water
  • 5,000 children a day die from diarrhea
  • water use will increase by about 50 percent in the next 30 years
  • an estimated 4 billion people - one half of the world’s population - will live under conditions of severe water stress in 2025

(sources: OECD, UNICEF, World Bank, WHO, WWC)

Many developing countries have grown quickly in the past few years and are emerging into world powers right now.

  • developing economies grew 7.3%, or

This article was written by

Brian Powers profile picture
Brian Powers is an independent investor. His writing generally focuses on thoughts related to investing in his Roth IRA account. Brian started investing in 1998. He is basically a value investor in that he generally invests for the long term. That does not mean he does not like so-called growth stocks. He loves growth stocks when he can buy them at a reasonable price. Additionally, there are sometimes reasons other than value that make a security attractive. Brian uses a bottoms up approach which starts with fundamental analysis. He has traditionally looked for small caps, but in the Roth IRA, he balanced his portfolio with large and mid cap exposure. Core positions are generally for the long term, but may be rebalanced as conditions warrant. Visit his blog:www.cavemanus.com (http://www.cavemanus.com/)

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