The utilities sector of the stock market it quite diverse, so it can be an exciting investment opportunity. Included in the utilities sector are water, natural gas and electric utilities as well as multi-utility companies such as Consolidated Edison. Also part of the utilities sector are independent utilities,such as U.S. Geothermal, representing alternative energy sources.

One of the attractions of buying into the utilities sector is the feeling that your company is investing in the future. Ask your utilities sector consultant about companies bringing solar, wind, and geothermal power to market. While many of these businesses are investing large sums of money today, the potential payoff is huge. As you collect utilities sector information, ask the following questions:

1. What companies comprise the utilities sector? Are there key subsectors?

2. How has the utilities sector performed recently? What are the leading stocks?

3. What type of investment in the utilities sector is best for the company?

Action Steps
The best contacts and resources to help you get it done

Find sources for utilities sector advice and education

As with any new journey, a good first step is to learn where you are going. Get utilities sector training for the folks responsible for building your company's portfolio and charting its performance. Many colleges and schools offer investment classes, and you can find a wealth of online courses of increasing sophistication.

I recommend: Enroll your investment team in courses provided by the online investment education company Investools. It offers courses from investment basics to targeted planning. Use the research tools at Fidelity to discover the performances of subsectors as well as several other performance indicators.

Research the market trends of the utilities sector and individual stocks

With a basic knowledge of the utilities sector and trends in its performance, your investment team can begin to find potential investment choices. It might be wise to 'watch' the sector and favored individual stocks for a short period or to get help with utilities sector investment from a consultant. Online brokerage houses and investor websites offer a range of tools to accomplish this.

I recommend: Use the research tools at Yahoo Finance to discover the daily individual stock price change, return on investment and sector performance. Order the free report from Wachovia Securities to determine where an investment in the utilities sector fits into your business's plans.

Decide whether to invest in individual stocks or a sector-focused fund

When your company is ready to add a utilities sector investment to its portfolio, decide whether to purchase shares in individual companies, in sector funds or both. Individual stocks allow you to target your investment to specific companies, while funds benefit from professional management.

I recommend: At Scottrade your company can build its own portfolio. You can invest in individual stocks, mutual funds and several other types of investments at affordable prices. Consider investing in the Exchange-Transfer Fund (ETF) managed by ALPS Distributors. It's comprised of the leading S&P utilities stocks.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  The subsectors of the utilities sector vary greatly from each other. You might consider balancing your investment in the sector by choosing stocks in a couple of offsetting subsectors.