Higher military spending drives these ETFs

Article Excerpt

An improving global economy and growing military threats continue to push up defense spending. Still, the total investment as a percentage of global GDP sits near recent lows. That leaves room for significant growth (see supplement on page 60). Here are three ETFs that provide exposure to companies positioned to benefit from increased military spending. SPDR S&P AEROSPACE & DEFENSE ETF $88 (New York symbol XAR; TSINetwork ETF Rating: Aggressive; Market cap: $1.3 billion) invests in U.S. companies that are involved in the aerospace and defense industries. The ETF tracks the S&P Aerospace & Defense Index. Its stocks are weighted by market capitalization. Each of the 66 stocks in the portfolio is capped at 4% of assets. The largest sector allocations are Industrials (91%), Technology (6%%) and Basic materials (3%). The top 10 holdings make up 35% of assets. They are TransDigm Group (3.8%), Textron (3.6%), Aerojet Rocketdyne (3.6%), BWX Technologies (3.5%), Aerovironment (3.5%), Harris Corp. (3.5%), HEICO Corp. (3.5%), Raytheon (3.4%), Teledyne Technologies (3.4%) and KLX…

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