Each general election cycle presents investors with the task of determining which investments could benefit from the outcome. The presidential nominees have shown that they agree on very little in regards to policies. And with an election race nearly tied in the polls, investors are left in a quandary. Such uncertainty in the past has normally led to stock market sell-offs and hoarding cash until a victor is determined and then make a longer-term play. But this year’s election cycle and stock market have been anything but normal.
There is certainly no shortage of prognostications though. While the nominees have differing plans for paying for it, there is one area that Integrous Investing finds that Trump, Clinton and even Johnson/Weld agree: infrastructure spending.
Globally, an aging infrastructure is noticeable in most every facet from transportation to power, even schools. But I find no area of infrastructure more important than water. Not only in providing the water we consume, but in the handling of waste water and pollution.
Research reports from multiple sources peg the water industry around $500 billion and estimate that doubling by 2020 – less than 4 years away. Virtually every aspect of the water industry begs investment. Our planet is faced with the growing concern to provide more water to more people in more places than ever before. And the need for efficiency of the water along with quality touches every one of us and nearly every industry.
Water wars are not just a problem “over there” as reported in The Economic Times. US residents of Georgia, Florida, California, Colorado, Wyoming, Texas and Oklahoma are experiencing this.
The investment opportunity resides in companies involved in water production, distribution, storage, transportation, filtering, testing, research, and conditioning. While the footprint of the water industry is immense, there are relatively small numbers of companies that derive the majority or even a significant portion of their business from water activities. This presents an attractive, but not easily identifiable target list.
In this time of significant economic and geo-political uncertainty, water investment is one area that I see supported by both political parties plus bulls and bears alike. While investing in water is something everyone can feel good about morally, I take comfort in that which offers a potential upside in the near, intermediate and long-term.
Watch: The New Color of Money – Water as an asset class.
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