iShares U.S. Aerospace & Defense ETF
Price
$225.98
YTD
—
Expense
0.40%
Yield
—
Best Space & Defense ETFs for 2026
Discover the best space exploration and defense ETFs for 2026. Compare ITA, PPA, ARKX, UFO and funds investing in aerospace, satellites, and defense contractors.
Complete Guide to Space & Defense ETFs in 2026
The space and defense sector is experiencing a renaissance driven by geopolitical tensions, the new space race, satellite internet deployments, and growing global defense budgets. The global defense market exceeds $2.2 trillion annually, while the space economy is projected to reach $1.8 trillion by 2035.
Defense Spending Boom
NATO countries are increasing defense spending toward the 2% of GDP target, with many exceeding 3%. This multi-year spending cycle benefits defense contractors like Lockheed Martin, RTX (Raytheon), Northrop Grumman, and General Dynamics.
Space Economy Growth
SpaceX has revolutionized launch economics, and satellite-based internet (Starlink, Amazon Kuiper), Earth observation, and space tourism are creating new commercial opportunities. Defense applications of space technology (surveillance, communications) add government spending tailwinds.
Top Space & Defense ETFs
ITA (iShares U.S. Aerospace & Defense ETF): The most popular defense ETF with holdings in all major defense contractors.
PPA (Invesco Aerospace & Defense ETF): Broader aerospace and defense coverage including smaller defense companies.
UFO (Procure Space ETF): Focused specifically on space-related companies including satellite operators, launch providers, and space technology firms.
ARKX (ARK Space Exploration & Innovation ETF): Cathie Wood's actively managed space ETF with positions in drone companies, 3D printing for space, and autonomous technology.
🏆 Winner — #1 pick
Industrial Select Sector SPDR
Price
$174.56
YTD
—
Expense
0.09%
Yield
—
Frequently asked questions
Why invest in space and defense ETFs?
The sector benefits from rising defense budgets, NATO spending increases, the new space race, satellite internet deployment, and commercial space growth.
What is the size of the global defense market?
The global defense market exceeds $2.2 trillion annually.
What is the projected size of the space economy by 2035?
The space economy is projected to reach $1.8 trillion by 2035.
Which ETFs provide exposure to the defense industry?
ITA (iShares U.S. Aerospace & Defense ETF) and PPA (Invesco Aerospace & Defense ETF) provide broad defense exposure.
Which ETFs provide exposure to the space industry?
UFO (Procure Space ETF) and ARKX (ARK Space Exploration & Innovation ETF) focus on space companies including satellite operators, launch providers, and space technology firms.
Who are the top defense companies in ITA ETF?
ITA holds Boeing, Lockheed Martin, RTX (Raytheon), Northrop Grumman, and General Dynamics.
What is the #1 pick for space and defense ETFs?
ITA — iShares U.S. Aerospace & Defense ETF is the top pick due to diversified exposure to major U.S. defense contractors.
What is the expense ratio of ITA?
ITA has an expense ratio of 0.4%.
What companies does UFO ETF invest in?
UFO invests in satellite operators, launch providers, and space technology firms.
What is the expense ratio of UFO ETF?
UFO has an expense ratio of 0.75%.
Which ETF is actively managed for space innovation?
ARKX — ARK Space Exploration & Innovation ETF is actively managed with positions in drones, 3D printing for space, and autonomous technology.
What is the price of ITA ETF?
ITA is priced at $221.91.
What is the price of UFO ETF?
UFO is priced at $49.17.
What sectors does XLI ETF cover?
XLI (Industrial Select Sector SPDR) covers defense, aerospace, machinery, transportation, and construction.
Why is defense spending expected to grow?
NATO and allied countries are increasing defense spending toward 2-3% of GDP, supporting multi-year growth for defense contractors.
What space applications benefit defense budgets?
Satellite communications, surveillance, and Earth observation technologies drive government spending alongside commercial growth.
Which ETF is recommended for conservative exposure to defense?
ITA is recommended for broad, low-cost exposure to major U.S. defense contractors.
Which ETF is recommended for aggressive space investment?
UFO or ARKX are recommended for high-growth exposure to commercial and innovative space technologies.
Does ITA include aerospace companies?
Yes, ITA includes both defense and major aerospace companies like Boeing.
What is the AUM of UFO ETF?
UFO has $40 million in assets under management.
What is the AUM of XLI ETF?
XLI has $19 billion in assets under management.
Are these ETFs suitable for long-term growth?
Yes, space and defense ETFs are suitable for long-term investors seeking exposure to secular growth and defense spending cycles.
Do these ETFs pay dividends?
ITA and XLI pay dividends; space ETFs like UFO may pay little to none as they focus on growth.
Which ETF provides broad aerospace and defense coverage including smaller companies?
PPA — Invesco Aerospace & Defense ETF offers broader coverage including mid-size defense companies.
Which ETF is best for exposure to satellite and commercial space companies?
UFO — Procure Space ETF provides focused exposure to satellite operators, launch providers, and space technology.
How does geopolitical tension affect these ETFs?
Geopolitical tensions drive increased defense spending, benefiting defense-focused ETFs like ITA and PPA.
Which ETF includes 3D printing for space applications?
ARKX — ARK Space Exploration & Innovation ETF includes 3D printing and autonomous technology for space.
Are space ETFs highly volatile?
Yes, space ETFs like UFO and ARKX are more volatile than traditional defense ETFs due to early-stage commercial space investments.
Which ETF is recommended for income-focused investors?
XLI or ITA are better suited for income investors due to their dividend-paying industrial and defense holdings.
Do these ETFs include international companies?
Most focus on U.S.-based companies, though ARKX and UFO may include some international exposure to space tech innovators.