SPDR Aerospace and Defense (XAR).
General Dynamics (GD), Lockheed Martin (LMC), Raytheon (RTN): It should not come as a big surprise that defense contractors tend to thrive when geopolitical tensions rise around the world. What might come as a surprise is just how strong the sector has been throughout the 5-year bull market. The better-known iShares U.S. Aerospace & Defense (ITA) has managed to make the S&P 500 ’s performance look pedestrian.
Granted, a money manager like myself cannot necessarily use a fund with limited liquidity such as the lesser-known XAR. Yet retail investors might be intrigued to learn that XAR has outperformed ITA over 1 month, 3 months, 6 months and 1 year. Moreover, XAR’s expense ratio is reasoanbly attractive at just 0.35%.