Designed to provide broad exposure to the Industrials ETFs category of the market, the Invesco Global Water ETF (PIO Quick QuotePIO - Free Report) is a smart beta exchange traded fund launched on 06/13/2007.

What Are Smart Beta ETFs?

Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.

Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.

But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.

This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.

The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.

Fund Sponsor & Index

The fund is managed by Invesco. PIO has been able to amass assets over $271.58 million, making it one of the average sized ETFs in the Industrials ETFs. This particular fund seeks to match the performance of the NASDAQ OMX Global Water Index before fees and expenses.

The NASDAQ OMX Global Water Index is designed to track the performance of companies worldwide that are creating products that conserve and purify water for homes, businesses and industries.

Cost & Other Expenses

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.

With one of the most expensive products in the space, this ETF has annual operating expenses of 0.75%.

It has a 12-month trailing dividend yield of 1.06%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

When you look at individual holdings, Pentair Plc (PNR) accounts for about 7.95% of the fund's total assets, followed by Ecolab Inc (ECL) and Veolia Environnement Sa (VIE).

PIO's top 10 holdings account for about 58.02% of its total assets under management.

Performance and Risk

So far this year, PIO has added roughly 14.08%, and is up about 10.07% in the last one year (as of 12/17/2025). During this past 52-week period, the fund has traded between $35.79 and $46.11.

The ETF has a beta of 1.05 and standard deviation of 15.50% for the trailing three-year period, making it a medium risk choice in the space. With about 47 holdings, it has more concentrated exposure than peers .

Alternatives

Invesco Global Water ETF is a reasonable option for investors seeking to outperform the Industrials ETFs segment of the market. However, there are other ETFs in the space which investors could consider.

First Trust Water ETF (FIW) tracks ISE Clean Edge Water Index and the Invesco Water Resources ETF (PHO) tracks NASDAQ OMX US Water Index. First Trust Water ETF has $1.91 billion in assets, Invesco Water Resources ETF has $2.12 billion. FIW has an expense ratio of 0.51% and PHO changes 0.59%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Industrials ETFs

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.