A company that owns and operates water supply and wastewater treatment infrastructure, typically under a regulated monopoly model. Water utilities generate revenue through tariffs charged to residential, commercial, and industrial customers, and tend to offer stable, dividend-paying equity characteristics.

The process of removing contaminants from water to make it safe for a specific end use, such as drinking, industrial processes, or environmental discharge. Water treatment technologies include filtration, reverse osmosis, UV disinfection, and chemical treatment, and represent a growing segment of the water industry as regulatory standards tighten globally.

A condition in which the demand for freshwater exceeds the available supply in a given region. Water scarcity is driven by population growth, urbanization, agricultural demand, and climate change, and is a primary structural driver behind investment in water infrastructure, conservation, and purification technologies.

An index construction methodology that adjusts traditional market-cap weighting with additional constraints such as concentration limits, liquidity screens, or sector caps. Several water ETF indices use this approach to prevent any single large-cap stock from dominating the portfolio while still reflecting the relative size of constituent companies.

The annual fee an ETF charges to cover stated operating costs such as management and administration, expressed as a percentage of assets. Depending on the source it may be quoted gross or net of contractual fee waivers. It does not capture every cost of owning a fund: brokerage commissions, bid-ask spreads, any premium or discount to NAV, and — for futures funds — roll effects are all separate. All else equal, a lower expense ratio means less annual fee drag on returns.

The net value of the assets an ETF holds. AUM indicates fund scale, but it does not by itself determine liquidity or trading costs; bid-ask spreads, trading volume, market makers and the liquidity of underlying holdings also matter. AUM changes with market prices and fund inflows or outflows.

Water ETFs are exchange-traded funds that invest in companies involved in the water industry, including water utilities, treatment and purification technology providers, infrastructure builders, and conservation-focused businesses. They offer investors diversified exposure to the water sector through a single tradeable security.

There are currently 5 water ETFs listed on US exchanges: PHO, FIW, CGW, PIO and AQWA. Two of them, PHO and FIW, hold US-listed companies only; CGW, PIO and AQWA are global and add European, UK, Japanese and Latin American water companies to the mix.

The Invesco Water Resources ETF (PHO) is the largest water ETF by assets, and also the oldest, launched in December 2005. It tracks the Nasdaq OMX US Water Index and holds US-listed water companies only. The First Trust Water ETF (FIW) ranks second by assets and is also US-only, while CGW is the largest of the three global funds. Current assets for every fund are in the table above, which sorts by AUM.

Two funds share the lowest expense ratio at 0.50%: the Global X Clean Water ETF (AQWA) and the First Trust Water ETF (FIW). First Trust also caps FIW's expenses contractually at 0.60% a year at least through 30 April 2027. The Invesco Global Water ETF (PIO) is the most expensive on this list, which is worth weighing against the fact that it is also the smallest and least traded. Every fee is shown in the table above.

Yes, most water ETFs pay quarterly dividends sourced from the underlying holdings. Yields vary depending on the fund’s allocation to water utilities versus industrial and technology companies. Funds with heavier utility weightings tend to offer higher dividend yields.

PHO holds US-listed water companies only and tracks the Nasdaq OMX US Water Index, which is liquidity-weighted and reconstituted annually in April. CGW tracks the S&P Global Water Index and holds water companies listed around the world, including UK regulated utilities such as United Utilities and Severn Trent and Brazil's SABESP alongside American Water Works and Essential Utilities. The practical difference is that CGW carries more regulated utility exposure and more currency exposure, while PHO sits closer to US industrial and instrument makers serving the water sector.