Water is essential to life and to nearly every part of the economy, from agriculture and manufacturing to food and beverages. Demand for clean water keeps rising, but supply is limited, and climate change is making shortages more likely in many regions.
That imbalance is driving long-term investment in water infrastructure, technology, and conservation. For investors, the opportunity spans utilities, filtration companies, and equipment makers that move and treat water.
Rather than picking individual stocks, many investors use water exchange-traded funds (ETFs) to get broad exposure to the sector in a single investment. A water ETF can offer diversified access to the companies working to deliver and manage one of the world’s most critical resources.
Top water ETFs to consider
Company | Total Assets | Description |
|---|---|---|
Invesco Water Resources ETF (NASDAQ:PHO) | $2.0 billion | A top-heavy collection of water stocks ranging from filtration-tech makers to utilities to pumping-equipment makers. |
First Trust Water ETF (NYSEMKT:FIW) | $1.9 billion | A less concentrated portfolio heavy on water tech stocks but including companies working in many different parts of the water chain. |
Invesco S&P Global Water Index ETF (NYSEMKT:CGW) | $1.0 billion | An index-based ETF that tries to provide broad global water exposure via the S&P Index that tracks the world's 50 largest water-related companies. |
Invesco Global Water ETF (NASDAQ:PIO) | $290.1 million | A more concentrated global portfolio with some exposure to emerging markets and a higher expense ratio. |
Ecofin Global Water ETF (NYSEMKT:EBLU) | $57.9 million | A relatively small entry with a focus on sustainability and ESG and low expenses. |
Global X Clean Water ETF (NYSEMKT:AQWA) | $17.8 million | An ETF focused on clean water through industrial water treatment, storage and distribution infrastructure, as well as purification and efficiency strategies. |
1. Invesco Water Resources
NASDAQ: PHO
Key Data Points
Investment management company Invesco (IVZ +1.04%) dominates the water ETF market, and the Water Resources (PHO +1.11%) fund is its largest offering. Based on the Nasdaq U.S. Water Index, the fund seeks to track the performance of companies that purify, deliver, and conserve water for homes, businesses, and industries. It is not limited to companies doing business in the U.S., but it is heavily focused on stocks that trade on U.S. markets.
As of January 2026, the top five holdings in the Invesco Water Resources ETF were:
- Ecolab (ECL +2.03%).
- Ferguson (FERG +1.30%).
- Roper (ROP +3.01%).
- Waters (WAT +1.42%).
- American Water Works (AWK -1.26%).
The five stocks represent about 37% of total assets, and Invesco Water Resources has a 0.59% expense ratio.
2. First Trust Water
NYSEMKT: FIW
Key Data Points
The water ETF sponsored by First Trust Advisors is based on the ISE Clean Edge Water Index, which comprises companies that derive a substantial portion of their revenue from the potable and wastewater industry. That can include utilities and other companies, but the index is weighted toward the companies that make the tech that helps to make water safe to drink.
As of January 2026, the top five holdings in the First Trust Water ETF (FIW +1.23%) were:
The five stocks represent about 22% of total assets, and the ETF has a 0.51% expense ratio.
3. Invesco S&P Global Water Index
NYSEMKT: CGW
Key Data Points
As the name implies, the Invesco S&P Global Water ETF (CGW +0.38%) gives you more international exposure and is based on the S&P Global Water Index. The fund aims to invest at least 90% of its total assets in securities tracking that index. The index that the fund is based on is designed to measure the performance of the 50 largest global companies in water-related businesses.
As of early January 2026, the top five holdings in this fund had an international flair. They were:
- Xylem (XYL +0.84%).
- Cia de Saneamento Básico do Estado de São Paulo (SBS -1.71%).
- American Water Works.
- United Utilities Group (UUGW.F +3.29%).
- Veralto (VLTO -6.20%).
The five stocks represent about 34% of total assets, and the ETF has an expense ratio of 0.59%.
4. Invesco Global Water
NASDAQ: PIO
Key Data Points
This, too, is an index fund, and it tracks the Nasdaq OMX Global Water Index. About 55% of fund assets are based in the U.S., followed by the U.K., Switzerland, and Japan. The fund also has exposure to emerging markets, including China and Brazil.
As of January 2026, the top five holdings in the Invesco Global Water (PIO +0.77%) fund were:
- Ebara (EBCOY +0.00%).
- Pentair (PNR +2.69%).
- Ferguson.
- Roper.
- Cia de Saneamento Básico do Estado de São Paulo.
The five stocks represent about 39% of total assets, and the ETF has an expense ratio of 0.75%.
5. Ecofin Global Water
NYSE: TBLU
Key Data Points
How water ETFs work
Water ETFs work by pooling investor money to buy a diversified basket of stocks in companies across the entire water industry, from utilities and infrastructure to technology. The idea is to give investors broad sector exposure through a single trade, addressing essential global demand and scarcity.
They provide exposure to critical areas such as water infrastructure, technology, and utilities, allowing you to invest in solutions for water scarcity and management.
How to choose a water ETF
Some factors to consider when choosing a Water ETF:
- What is the focus? Is this ETF leaning towards utilities or water technology? Or a mix of both?
- What are your goals? Some ETFs aim to maximize income, while others focus on growth. Read about individual ETFs on their fund pages and see if the fund's goals are a good match for what you want.
- Check expenses. ETFs' expenses (as measured by the expense ratio) can vary. Higher fees make it harder to beat the market.
Are water ETFs right for you?
Water isn't the most glamorous investment, but it is hard to think of a commodity more critical to society. Nations have gone to war over access to water. Those days are hopefully behind us, but given how widely water is used and the limited amounts of it available in many parts of the world, water should be an area of significant investment and growth in the years to come.
Buying into the water industry can also provide a nice counterweight to more speculative tech investments or boom-and-bust cyclical companies. Buying ETFs instead of individual companies provides an easy way to gain geographic and subsector diversification without having to devote too much of your portfolio to the industry.
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