Water could be the key to your retirement.

And I'm not talking about digging your toes into the white sand of some island oasis as the tide comes in. . . though that too could be a possibility.

Instead, I'm talking about leveraging water's looming profit potential for sustained above-average returns.

Of course, investing in water is a theme I've hit on early and often. I've been blowing this bull horn for several years.

And while the recession put a wrench in this profit-maker's gears — as it did many others' — recovery efforts have once again made water a highly attractive and liquid market.

Here's what I mean. . .

Using the "Philly Plan" for Profit

I generally talk about water from a macro level, discussing multi-billion markets and the companies operating within them. At times, it may feel like there's no tangible real-world connection.

To bridge that gap, I'd like to take a moment to tell you about a profitable water plan that's taking shape in Philadelphia and will soon be replicated across the country.

The city has announced a 20-year, $1.6 billion plan to transform its wastewater system. And, as with all water projects, that money will be going to parts suppliers and environmental engineering firms — some of which you can invest in.

According to Jon Capacasa, a regional director for the EPA, "This is the most significant use of green infrastructure I've seen in the country, the largest scale I've seen."

Patrick Starr, senior VP of the Pennsylvania Environmental Council believes "It's the most significant investment in transforming the city that we'll see in our lifetimes."

This type of plan can be transformational for your portfolio, as well.

In a nutshell, the plan involves:

• creating rain gardens

• building green roofs

• installing porous pavement

• laying new pipes and

• expanding treatment facilities

Finding out how that $1.6 billion will be divided and spent — and to whom it will be paid — is the key to using this project for personal profit. And the long-term nature of the project means sustainable profits for years.

What's more, Philadelphia is the first city to propose such a bold measure. But as other cities — both large and small — follow their lead. . . the total spent on water projects will only surge. And so will related investor profits.

Potential Profits Become Pocketed Profits

The window on this opportunity isn't closed by any stretch of the imagination. . . but there is now a firm screen in place.

That's because investors are quickly becoming aware of the lucrative profits the water industry has to offer. Some water infrastructure stocks have surged nearly 80% since March.

This is mostly due to the American Recovery and Reinvestment Act, otherwise known as The Stimulus. The act allocated more than $11 billion to be spent on water projects.

All you need to do is take a position early, before this quietly creeping megatrend reaches ubiquity.

And it's happening quickly.

Some $4 billion ($11 billion set aside) has already been allocated for water-related improvements across the country — $93.7 million has already been awarded to Pennsylvania, and each state will get its share.

And it's pushing water stocks ever-higher.

One of the best ways to get in and stay in is through a water ETF, which I've said numerous times. But you won't blame me after you see how they're performing:

They may be up ~40% over the past six months, but they will undoubtedly head higher as more stimulus dollars are approved and more projects —like the one in Philly— take shape.

And they will.

Washington D.C. is pursuing a $2.2 billion plan to build giant sewer overflow tunnels. Surely you've seen related spending in your area.

Call it like you see it,

Nick

P.S. I've been using this megatrend to pick off winner after winner for my readers. In fact, they've been averaging 32% per month for the past year on my recommended winners. And they've done it simply by following my guidance exclusively on cleantech and water stocks. Click here to see how they've done it. . . and what their next trade will be.