Elbit Systems Ltd.: This company develops airborne, naval, and land systems for defense. Its portfolio includes unmanned aerial vehicles (UAVs), electro-optics, and electronic warfare systems. Its stock has generated a one-year return of more than 102 percent.

Aerospace ETFs

If you don’t want to individually pick stocks in the aerospace and defense sector, you can purchase exchange-traded funds (ETFs) that aim to mimic the performance of the industry as a whole. These ETFs are professionally managed funds that hold leading stocks throughout the aerospace and defense industry. Here are some top picks:

iShares U.S. Aerospace & Defense ETF
Invesco Aerospace & Defense ETF
SPDR S&P Aerospace & Defense ETF
Global X Defense Tech ETF
ARK Space Exploration & Innovation ETF

Risks of the Aerospace Sector

Because the A&D industry is heavily dependent on government spending, changes in budget management, international relations, and shifts in geopolitical tensions could make it a highly volatile sector at times. It’s also fiercely competitive. Aerospace and defense companies can create technology that makes that of others obsolete. Moreover, it’s a highly regulated industry. And compliance pressure could delay or even prevent new tech from coming into market. This is why it’s important to pay attention to what these companies are developing and where they stand against their competitors.

The Bottom Line

The aerospace and defense sector is driven by innovation and benefits from long-term government contracts. But it is a highly competitive and regulated market that needs to be carefully analyzed before you invest. It may be best to start by investing in ETFs that track the broader aerospace and defense industry, as this gives you diversification across many different companies at the forefront of the sector.

To the Moon and Beyond: How to Invest in the Aerospace Sector

How Major US Stock Indexes Fared April 24

How Major US Stock Indexes Fared April 23

How Major US Stock Indexes Fared April 22