This exchange traded fund tracks an index of global companies operating in the water industry. The fund may use derivatives to hedge against currency risks. Income will be distributed as cash.
Did this share used to be called global water?
Yes, it’s an Exchange Traded Fund - ETF
Sorry for what might be a stupid question but why is this ETF tracing water companies dropping like this?
The water companies making up the ETF may be overpriced and are falling to their ‘correct’ price - which in turn drags down this ETF.
A quick look at the portfolio shows a P/E ratio of 36.5, which does suggest it is overpriced slightly.
I think water is going to be very valuable in the 21st century and a global water crisis is coming due to inefficient use of water and erratic seasons from climate change. I think water is a good investment. Water was called the ‘petroleum of the 21st century’… for that reason I would keep any investment in this ETF as I think it will only increase long term.
Thanks. I agree that in the long term this will go up for the reasons you mentioned. I was wondering if inflation/cost of living increases would hamper the companies’ ability to receive income. It’s dropping like a stone though - en route to the drop when the pandemic started.