Is Water the Oil of the 21st Century?

Water is set to replace oil as the commodity to watch, as soaring global demand and scarce supplies bring home the value of this most basic resource to investors, a director at an asset manager told CNBC Thursday.

"You're going to see with the growing population, the greater need for water; it's the one thing we can’t do without," Ian Morley, Director at DDQ, said.

The momentum in buying commodities and selling financial stocks has made many funds a lot of money this year, but most investors have missed the investment opportunity in water altogether, according to Morley.

"This is the type of commodity that is going to be particularly strategic going forward … from an investor's point of view this has got to be a long term and a very balanced play in the markets," he said.

Morley said investors looking to profit from water should look take a holistic view, investing directly in water companies implementing technologies such as desalination as well as the infrastructure that supports them.