At first glance, the idea of investing in water might sound like the common phrase, “He can sell ice to an Eskimo.” However, clean water may be one of the greatest business propositions in the world today.
It follows that you may indeed wish to consider the PowerShares Water Resources (PHO) exchange traded fund. PHO tracks the Palisades “H2O Index,” which invests in the common stocks of companies in the water industry.
PHO has been on one crazy water park ride since its inception, trading at about 17.5 per share at inception, climbing to 19 before losing nearly 20% of its value back down to 15.5. It subsequently climbed back to the 19.5 level, then hit the recent market selloff in early March to fall to 18.
Its current price of 19.25 is reasonably attractive on a fundamental and technical basis. Its P/E currently approximates the S&P 500’s price-to-earnings ratio.
Disclosure statement: Some of Pacific Park’s investment clients may hold positions in any of the investments mentioned above.