That sector lineup has changed significantly from August when we last highlighted DEF. At that time, the ETF’s allocation to the energy sector was north of 44%. Today, energy is merely DEF’s seventh-largest sector weight at 3.9%, according to Guggenheim data.
Those conservative sector exposures give DEF a standard deviation of 8.37%, or 120 basis points below the three-year standard deviation on the S&P 500. Interestingly, investors do not have to pay up for the privilege of paying defense with DEF. The ETF’s P/E ratio is 17.7 while the P/E ratio on the S&P 500 is closer to 20.
Conservative sector posturing gives DEF a trailing 12-month dividend yield of 2.51%, 60 basis points above the S&P 500 and 55 basis points above the yield on 10-year U.S. Treasurys.
Guggenheim Defensive Equity ETF