Water Investing: 5 Funds You Should Tap

As the importance of water sustainability becomes ever more apparent, so too do the potential rewards of investing in water.

water with air bubbles
(Image credit: Getty Images)

Water sustainability might not be among the flashiest crises our planet faces, but it’s certainly one of the most important. Put simply: All 7.9 billion humans on this planet need water. And as worldwide water shortages grow, so too does interest in water investing – that is, in companies that help treat, distribute and dispense water.

“Water is at the core of sustainable development and is critical for socio-economic development, healthy ecosystems and for human survival itself,” the United Nations says. It is also a finite and irreplaceable resource that can only be renewed if well-managed.

The problem: It’s currently not well-managed in many parts of the world.

“In 2020, around 1 in 4 people lacked safely managed drinking water in their homes and nearly half the world’s population lacked safely managed sanitation,” according to the World Health Organization and UNICEF. “Billions of people around the world will be unable to access safely managed household drinking water, sanitation and hygiene services in 2030 unless the rate of progress quadruples.”

Anthony Eames, director of responsible investment strategy at Calvert, a leading provider of environmental, social and governance (ESG) investments, says “the reality of water scarcity means that stewardship is a financially material issue for many industries,” adding that numerous companies depend on access to water in their manufacturing supply chains.

“Responsible investors can play a role in water stewardship efforts,” he adds.

A growing spotlight on water sustainability, then, is also shining brightly on water investing. If you’re interested in starting to invest in water, read on as we highlight five mutual funds and exchange-traded funds (ETFs) that focus on this theme.

Data is as of Sept. 9. Dividend yields represent the trailing 12-month yield, which is a standard measure for equity funds.

Coryanne Hicks
Contributing Writer, Kiplinger.com

Coryanne Hicks is an investing and personal finance journalist specializing in women and millennial investors. Previously, she was a fully licensed financial professional at Fidelity Investments where she helped clients make more informed financial decisions every day. She has ghostwritten financial guidebooks for industry professionals and even a personal memoir. She is passionate about improving financial literacy and believes a little education can go a long way. You can connect with her on Twitter (opens in new tab), Instagram (opens in new tab) or her website, CoryanneHicks.com (opens in new tab).