For months, we’ve been pounding the table over defense ETFs.
Tensions with Iran were boiling over. Europe has been increasing its defense efforts with the Ukraine-Russia war. President Trump was also pounding away at the Houthis.
And now, Israel and Iran are at war, which could draw in the United States.
In addition, as noted by Time, “Russia, a longtime ally of Iran and nuclear-armed adversary of the U.S., has sounded the alarm about the potential globally-devastating consequences of the conflict, especially should the U.S. military get more involved.”
In short, it’s becoming a very bad situation that won’t end well.
With that, it also comes as no surprise that NATO is considering a new defense spending target of 5% of GDP, up from the current 2%. In addition, President Trump recently unveiled plans for a $1 trillion defense budget next year.
That being said, we’re still pounding the table over defense ETFs, including:
SPDR S&P Aerospace & Defense ETF (SYM: XAR)
The SPDR S&P Aerospace & Defense ETF seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the S&P Aerospace & Defense Select Industry Index. The XAR ETF has an expense ratio of 0.35%.
When we highlighted opportunity in XAR in December 2024, it traded at around $160. It’s now up to $196.56 and should run even higher.
iShares U.S. Aerospace & Defense ETF (SYM: ITA)
The iShares US Aerospace & Defense ETF invests in stocks in the domestic aerospace and defense sector. These stocks can include companies that manufacture both commercial and military aircraft as well as other types of defense-related equipment. The ITA ETF has an expense ratio of 0.40% at the moment.
When we highlighted opportunity in ITA in December 2024, it traded at around $150. Today, it’s up to $178.78.
Power Shares Aerospace & Defense ETF (SYM: PPA)
The Invesco Aerospace & Defense ETF tracks a market-cap-weighted index of US-listed stocks involved in the defense, military, homeland security and space industries. The PPA ETF has an expense ratio of 0.57%.
When we highlighted opportunity in PPA in December 2024, it traded at around $117. It’s now up to $134.96 a share and is still a strong opportunity.
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Written by Ian Cooper