Launched on 06/13/2007, the Invesco Global Water ETF (PIO) is a smart beta exchange traded fund offering broad exposure to the Industrials ETFs category of the market.
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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Because the fund has amassed over $296.8 million, this makes it one of the average sized ETFs in the Industrials ETFs. PIO is managed by Invesco. PIO 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
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Operating expenses on an annual basis are 0.75% for PIO, making it one of the most expensive products in the space.
It's 12-month trailing dividend yield comes in at 0.96%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Ebara Corp (J12600128) accounts for about 9.95% of the fund's total assets, followed by Cia De Saneamento Basico Do Estado De Sao Paulo Sabesp (SBSP3) and Ferguson Enterprises Inc (FERG).
PIO's top 10 holdings account for about 58.8% of its total assets under management.
Performance and Risk
Year-to-date, the Invesco Global Water ETF return is roughly 8.51% so far, and it's up approximately 17.22% over the last 12 months (as of 02/18/2026). PIO has traded between $35.79 $48.15 in this past 52-week period.
PIO has a beta of 1.05 and standard deviation of 15.09% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 48 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 $1.96 billion in assets, Invesco Water Resources ETF has $2.14 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.
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Invesco Global Water ETF (PIO): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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