By Robert Ross
This might surprise you, but water is a fantastic investment.
That’s pretty substantial, especially compared to the S&P 500’s 3% gain during this stretch.
Water Stocks Offer a Safe Haven
Stock market volatility is part of the reason water stocks are doing so well right now.
You probably know that US stocks have had a rollercoaster year. In August alone, there were five days when the S&P 500 rose or fell 1%. (This only happened on eight days during all of 2018.)
At the same time, stocks are flirting with all-time highs. And we’re at the tail end of the longest bull market in US history. So investors are rightfully skittish.
When stock market risk rises, investors flock to safe and reliable stocks. And water stocks fit that bill.
Water utilities are my favorite type of water stock. These companies process and deliver water to cities and towns. They’re often highly regulated, which limits profits. But it also keeps out competition.
Water infrastructure and equipment companies are another good option. These companies work with water utilities and the industrial and commercial sectors to improve water treatment and transport options.
Either way, you want some exposure to the water industry right now…
People Always Need Water
Remember when stocks fell 20% between September and December last year?
Same story for water infrastructure firm AquaVenture Holdings Ltd. (WAAS). While the S&P 500 was in freefall, AquaVenture shot up 9.0%.