Typically, it’s the promise of increased military spending that boosts defense-sector stocks, says Karen Hiatt, a senior portfolio manager with Allianz Global Investors,” according to CNBC. “While the sector has been outperforming the broader index for a few years now, prices jumped 6.8 percent in the week after Trump was elected, and they’ve climbed another 31 percent since then.”
Year-to-date, investors have added $1.95 billion to ITA and $224 million to PPA.
Traders looking for a more aggressive play on aerospace equities can consider the Direxion Daily Aerospace & Defense Bull 3X Shares (NYSEARCA: DFEN). DFEN, which debuted earlier this year, seeks to deliver triple the daily returns of the Dow Jones U.S. Select Aerospace & Defense Index.
For more information on the defense industry, visit our aerospace & defense category.