6 HOT Global Trends You Should Invest In Now: SCARCITY OF FRESHWATER (4)

Water covers about 97% of the earth's surface yet the world continues to face severe water shortages.

Why is this so and how can you as an individual investor profit from this global conundrum? Please read on to find out.

Neither North Korea nor Iran will start World War III.

WATER, the "Blue Gold", probably will.

All around the world tensions are rising or remain elevated over water.

In Africa, Egypt is ready to go to war with Sudan and Ethiopia over the River Nile.

The Jordan River basin remains a flashpoint because it serves Israel, Palestine, Jordan, Syria, and Lebanon.

The UN says there are tensions and disagreements among countries along the Mekong River in Indochina as well as around the Aral Sea in Eastern Europe.

In the U.S., the Colorado River, which serves California, Arizona, Nevada, Texas, and Utah, is drying up, while Florida, Georgia, and Alabama routinely butt heads over a shared river basin.

Although we are a water planet, the bulk of this water is "saltwater", which is unfit for human consumption. The little "freshwater" available is what countries are fighting over.

As the world's population explodes and urbanization rages over the next decades, demand for potable water will be unprecedented. Luckily for you as an investor, there are more than a handful of companies around the world pouring billions of dollars into making the abundant saltwater fit for human consumption. Water service providers, especially companies involved in saltwater desalination and waste-water treatment, are poised for phenomenal growth.

The water services industry comprises primarily high-growth, small to medium-cap companies whose stocks tend to be very volatile. If you can't stand the volatility of individual stocks, then pick an index fund or exchange-traded fund (ETF). There are several popular ETFs focused on water service companies.

If you have the stomach for high beta, then consider individual stocks of companies that derive all or the majority of their revenue from water resources. Don't be tempted here by big companies, like GE and ABB, that derive a minority of their revenue from water services because you'd be getting too much of what you may not want.

Now, i don't know at this point if saltwater desalination will be more important than waste-water treatment in the quest to meet the world's hunger for freshwater. Therefore, at first i wasn't sure which companies to invest in. You may have the same dilemma.

After much research i eventually picked one pure-play desalination company and one firm involved primarily in waste-water treatment. My desalination pick was Energy Recovery, Inc. (ERII), an American firm that has been expanding its global footprint. It also has ambitions in the oil and gas industry. Abtech Holdings (ABHD), a micro-cap company that partners with industry giant Waste Management (WM), was my waste-water treatment pick.

Invest in the global scarcity of water now, so that in future mandatory water rationing won't feel so bad if or when it comes to your neck of the woods.

This is the fourth in a series of posts that examine six hot global trends you should invest in now. In the next blog, i examine the hot trend of Robotics.