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Should You Invest in the Invesco Water Resources ETF (PHO)?
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Designed to provide broad exposure to the Industrials - Water segment of the equity market, the Invesco Water Resources ETF (PHO - Free Report) is a passively managed exchange traded fund launched on December 6, 2005.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Industrials - Water is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 7, placing it in top 44%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $2.18 billion, making it one of the larger ETFs attempting to match the performance of the Industrials - Water segment of the equity market. PHO seeks to match the performance of the NASDAQ OMX US Water Index before fees and expenses.
The NASDAQ OMX US Water Index tracks the performance of US exchange-listed companies that create products designed to conserve and purify water for homes, businesses and industries.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.59%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.52%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector -- about 57% of the portfolio. Utilities and Information Technology round out the top three.
Looking at individual holdings, Ecolab Inc (ECL) accounts for about 7.83% of total assets, followed by Roper Technologies Inc (ROP) and Ferguson Enterprises Inc (FERG).
The top 10 holdings account for about 58.22% of total assets under management.
Performance and Risk
The ETF has added about 4.94% and was up about 8.68% so far this year and in the past one year (as of 01/26/2026), respectively. PHO has traded between $58.13 and $74.61 during this last 52-week period.
The ETF has a beta of 1.05 and standard deviation of 16.16% for the trailing three-year period, making it a medium risk choice in the space. With about 39 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco Water Resources ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PHO is a reasonable option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Invesco S&P Global Water Index ETF (CGW) tracks S&P GLOBAL WATER INDEX and the First Trust Water ETF (FIW) tracks ISE Clean Edge Water Index. Invesco S&P Global Water Index ETF has $1.03 billion in assets, First Trust Water ETF has $1.97 billion. CGW has an expense ratio of 0.59%, and FIW charges 0.51%.
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.
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Should You Invest in the Invesco Water Resources ETF (PHO)?
Designed to provide broad exposure to the Industrials - Water segment of the equity market, the Invesco Water Resources ETF (PHO - Free Report) is a passively managed exchange traded fund launched on December 6, 2005.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Industrials - Water is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 7, placing it in top 44%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $2.18 billion, making it one of the larger ETFs attempting to match the performance of the Industrials - Water segment of the equity market. PHO seeks to match the performance of the NASDAQ OMX US Water Index before fees and expenses.
The NASDAQ OMX US Water Index tracks the performance of US exchange-listed companies that create products designed to conserve and purify water for homes, businesses and industries.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.59%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.52%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector -- about 57% of the portfolio. Utilities and Information Technology round out the top three.
Looking at individual holdings, Ecolab Inc (ECL) accounts for about 7.83% of total assets, followed by Roper Technologies Inc (ROP) and Ferguson Enterprises Inc (FERG).The top 10 holdings account for about 58.22% of total assets under management.
Performance and Risk
The ETF has added about 4.94% and was up about 8.68% so far this year and in the past one year (as of 01/26/2026), respectively. PHO has traded between $58.13 and $74.61 during this last 52-week period.
The ETF has a beta of 1.05 and standard deviation of 16.16% for the trailing three-year period, making it a medium risk choice in the space. With about 39 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco Water Resources ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PHO is a reasonable option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Invesco S&P Global Water Index ETF (CGW) tracks S&P GLOBAL WATER INDEX and the First Trust Water ETF (FIW) tracks ISE Clean Edge Water Index. Invesco S&P Global Water Index ETF has $1.03 billion in assets, First Trust Water ETF has $1.97 billion. CGW has an expense ratio of 0.59%, and FIW charges 0.51%.
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.