As long as funding for the Iraq war continues, the PowerShares Aerospace & Defense (PPA) exchange traded fund (ETF) is likely to benefit. Currently, PPA is at a new high of 27.0% year-to-date.

Several holdings in PPA hit new highs yesterday as the Defense Secretary Robert Gates requested about $45 billion in additional funding for military costs in Iraq and Afghanistan, reports Donna Borak for the Associated Press. Lockheed Martin (LMT), PPA’s fourth largest holding at 6.1%, had the highest increase, adding 1.5%. Its shares are near all-time highs. In addition, Raytheon (RTN), the ETF’s sixth largest holding at 4.9%, touched a new high. PPA’s seventh largest holding at 4.7%, General Dynamics (GD) was also up.

President Bush is preparing to ask Congress to approve another $200 billion for war funding through next year, and if it’s approved, it would make 2008 the most expensive year yet, reports Julian E. Barnes for the Los Angeles Times. Earlier this year, the Bush administration estimated it would need $147.5 billion for war-related spending in 2008. However, Pentagon officials say an additional $47 billion is required for such necessary items as mine-resistant trucks to protect troops from roadside bombs that can cost three to six times more than an armored Humvee. The war in Iraq currently costs taxpayers about $12 billion a month when costs of CIA operations and embassy expenses are added.