Quenching a thirst? Investing in water-related funds

As natural resources go, oil tends to get more attention from investors than clean drinking water, even against the backdrop of headline-grabbing shortages in Flint, Michigan, South Africa and elsewhere.

But a few funds are showing that investing in utilities and water infrastructure and technology companies can pay off, especially for long-term investors looking to diversify their portfolio.

Several exchange-traded funds invest in water-related stocks, including PowerShares Water Resources ETF (PHO), First Trust ISE Water Index Fund (FIW) and Tortoise Water Fund (TBLU).

Each holds shares in U...