Looming Water Shortages Create Wave of ‘Blue’ Investing

The world is getting thirstier. The World Bank estimates that global water consumption will increase by 50 percent over the next 30 years. But the planet has no more water today than it did after the Big Bang, and as with any commodity that appears to be running out, this resource is attracting new interest from investors.

No fewer than eight exchange-traded funds now specialize in water-related investments. The endowments of Harvard University and Duke University have both begun to focus on water. And last year the California Public Employees’ Retirement System committed $260 million to the venture capital firm of one of Sun Microsystems’ co-founders, Vinod Khosla. The firm seeks out emerging water technologies, among other cutting-edge investments.

仅全球范围内的股票围绕水基础设施 - 从管道，阀门和过滤器到海水化系统的一切 - 被认为是5500亿美元至7000亿美元（美国的约1350亿美元）。威廉布伦南峰会全球经理威廉布伦南（Constfolio Manager）是4.5亿美元的基于San Diego的公司，具有水对冲基金以及水资源基金 - 投资水权的私人投资池 - 估计公共市场很容易增长到1万亿美元。

[亚慱体育app视频标题：如何投资水：英国的第一个HosePipe禁令于7月9日在西北部，不到一年后，该地区看到缺乏洪水。来自WHEB资产管理的TED Franks考虑了该部门的投资机会。通话时间：星期五7月9日2010 |早上6:30 et]

Institutional investors have so far poured $25 billion into water-linked stocks, typically those of water utilities and water-treatment plants. The water industry’s need for funding is so great that it ranks as the fourth most capital-intensive business globally. But U.S. investors are relative newcomers to so-called blue investing.

Water investments can be as fluid as the liquid itself. “Thematically, water offers a very diverse set of opportunities for investment and trading,” says Michelle McCloskey, head of research at New York–based fund of hedge funds Man Investments, a subsidiary of London-based Man Group. Water investments encompass five distinct categories: regulated utilities; water “resources” (ownership of and access to H2O); water treatment; testing, controls and measurement; and infrastructure. These investments all offer different risks and returns. One benchmark, the S&P global water index, comprising 50 of the largest water-related public companies, this year is up 13.4 percent through July 30 and has an annualized 7.26 percent return over five years.

No single approach seems to predominate among water investors. “We invest in everything from water rights to the plumbing that delivers water,” says Marc Robert, chief operating officer of New York–based Water Asset Management, a four-year-old firm that invests exclusively in water-related equities. “We are sourced to the tap.” WAM’s $230 million TRF Master Fund, a long-short hedge fund (with a private equity side pocket), screens for companies that derive 35 percent or more of their sales from water. The fund is up 6.56 percent through July 30. Summit’s Brennan, who was trained as an environmental engineer and ran a successful water fund for three years before joining the California firm in July, contends that hedge funds are the way to go in water investing. He argues that, given the increasing number of low-cost, high-beta, water-themed ETFs,“to have a product institutionally that’s not hedged is doing a disservice.”

他还警告说,“这是一个诡计y minefield to navigate” because of the engineering, financial and regulatory issues associated with water.

Brennan’s advice notwithstanding, some long-only water funds have been holding their own. Jens Peers, head of environmental strategies at Dublin-based KBC Asset Management, oversees a water fund that invests in about 50 public companies — including one that uses ultrasonic waves to find leaks in water pipes — and has achieved a net annualized return for the five years through June of 3.74 percent, versus the MSCI world index’s 0.61 percent. “We expect this sector to outperform by 3 to 5 percentage points annually,” says Peers. Now that calls for a toast of clear, cool water.