While a sharp rise in the price of perpetual water entitlements over the past decade is yet to entrench it as a mainstream asset class, a legislative overhaul and climate change could see that gradually change.

Australia is one of the few countries in the developed world where rights to perpetual water allocations have been tradable for more than a decade. A water entitlement is an ongoing legal right to a share of water from a particular water resource, and needs to be differentiated from the volatile spot price of water in any particular year.