Why Aerospace & Defense ETFs Are Rising

Image: Bigstock

Aerospace and defense stocks have rallied lately with rising geopolitical tensions. The Russia-Ukraine war is unlikely to end soon, North Korean saber rattling has been on the rise, and China-Taiwan tensions have flared up since President Xi secured a third term in office.

Rising geopolitical tensions could result in increased defense spending by the US and its European allies as they try to counter the military ambitions of China and Russia.

The midterm elections could result in split control of Congress leading to legislative gridlock. Increasing defense spending is one of the very few areas that the two parties agree on.

The iShares U.S. Aerospace & Defense ETF (ITA - Free Report) tracks a market-cap-weighted index of companies in the aerospace and defense sector. Raytheon Technologies (RTX - Free Report), Lockheed Martin ((LMT - Free Report), Boeing (BA - Free Report), and Northrop Grumman (NOC - Free Report) are its top holdings.

The SPDR S&P Aerospace & Defense ETF (XAR - Free Report) is an equal-weighted ETF. The Invesco Aerospace & Defense Portfolio (PPA - Free Report) invests in companies involved in the development, manufacturing, operations, and support of US defense, homeland security, and aerospace operations.

Video Length: 00:08:36

More By This Author:

Why Cash-Rich Companies And #ETFs Are Beating The Market?
Best & Worst Performing ETFs Of Q3 2022
Uranium ETFs To Play The Nuclear Renaissance

Disclaimer: Neither Zacks Investment Research, Inc. nor its Information Providers can guarantee the accuracy, completeness, timeliness, or correct sequencing of any of the Information on the Web ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.