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Should You Invest in the iShares U.S. Aerospace & Defense ETF (ITA)?
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Looking for broad exposure to the Industrials - Aerospace & Defense segment of the equity market? You should consider the iShares U.S. Aerospace & Defense ETF (ITA - Free Report) , a passively managed exchange traded fund launched on 05/01/2006.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Aerospace & Defense is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 3, placing it in top 19%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $6.03 billion, making it one of the largest ETFs attempting to match the performance of the Industrials - Aerospace & Defense segment of the equity market. ITA seeks to match the performance of the Dow Jones U.S. Select Aerospace & Defense Index before fees and expenses.
The Dow Jones U.S. Select Aerospace & Defense Index measures the performance of the aerospace and defense sector of the U.S. equity market.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.40%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.59%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector--about 99.60% of the portfolio.
Looking at individual holdings, Boeing (BA - Free Report) accounts for about 16.95% of total assets, followed by Rtx Corp (RTX - Free Report) and Lockheed Martin Corp (LMT - Free Report) .
The top 10 holdings account for about 75.75% of total assets under management.
Performance and Risk
So far this year, ITA has added about 13.71%, and it's up approximately 16.35% in the last one year (as of 12/20/2023). During this past 52-week period, the fund has traded between $103.16 and $126.46.
The ETF has a beta of 1 and standard deviation of 20.16% for the trailing three-year period, making it a medium risk choice in the space. With about 37 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Aerospace & Defense ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, ITA is an excellent option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
SPDR S&P Aerospace & Defense ETF (XAR - Free Report) tracks S&P Aerospace & Defense Select Industry Index and the Invesco Aerospace & Defense ETF (PPA - Free Report) tracks SPADE Defense Index. SPDR S&P Aerospace & Defense ETF has $1.96 billion in assets, Invesco Aerospace & Defense ETF has $2.56 billion. XAR has an expense ratio of 0.35% and PPA charges 0.58%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should You Invest in the iShares U.S. Aerospace & Defense ETF (ITA)?
Looking for broad exposure to the Industrials - Aerospace & Defense segment of the equity market? You should consider the iShares U.S. Aerospace & Defense ETF (ITA - Free Report) , a passively managed exchange traded fund launched on 05/01/2006.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Aerospace & Defense is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 3, placing it in top 19%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $6.03 billion, making it one of the largest ETFs attempting to match the performance of the Industrials - Aerospace & Defense segment of the equity market. ITA seeks to match the performance of the Dow Jones U.S. Select Aerospace & Defense Index before fees and expenses.
The Dow Jones U.S. Select Aerospace & Defense Index measures the performance of the aerospace and defense sector of the U.S. equity market.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.40%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.59%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector--about 99.60% of the portfolio.
Looking at individual holdings, Boeing (BA - Free Report) accounts for about 16.95% of total assets, followed by Rtx Corp (RTX - Free Report) and Lockheed Martin Corp (LMT - Free Report) .
The top 10 holdings account for about 75.75% of total assets under management.
Performance and Risk
So far this year, ITA has added about 13.71%, and it's up approximately 16.35% in the last one year (as of 12/20/2023). During this past 52-week period, the fund has traded between $103.16 and $126.46.
The ETF has a beta of 1 and standard deviation of 20.16% for the trailing three-year period, making it a medium risk choice in the space. With about 37 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Aerospace & Defense ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, ITA is an excellent option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
SPDR S&P Aerospace & Defense ETF (XAR - Free Report) tracks S&P Aerospace & Defense Select Industry Index and the Invesco Aerospace & Defense ETF (PPA - Free Report) tracks SPADE Defense Index. SPDR S&P Aerospace & Defense ETF has $1.96 billion in assets, Invesco Aerospace & Defense ETF has $2.56 billion. XAR has an expense ratio of 0.35% and PPA charges 0.58%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.