On valuation, utilities are also pricey and trading towards the higher end of the sector’s historical averages. XLU has a P/E of about 15.4, but FIW’s P/E is 20.4, according to issuer data.

To be fair to FIW, its returns confirm that making those trade-offs has been worth it. And as rates have crept higher over the past month, FIW has traded higher while VPU has not. FIW is less than 1% below its 52-week high while VPU is 6% below its 52-week high.

First Trust ISE Water Index Fund

ETF Trends editorial team contributed to this post.

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