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In this episode of ETF Spotlight, I speak with Tony Bancroft, portfolio manager of the Gabelli Commercial Aerospace & Defense ETF (GCAD - Free Report) , about the outlook for the aerospace and defense industry.
Boeing (BA - Free Report) shares have plunged about 20% since a part of a 737 Max 9 jet operated by Alaska Airlines (ALK - Free Report) blew out mid-flight, forcing the plane to make an emergency landing. This incident led to the grounding of many 737 MAX jets by the Federal Aviation Administration (FAA).
Last week, the FAA allowed the grounded jets to resume flying but imposed limits on Boeing’s 737 production. Boeing has continued to face questions about its quality control systems, particularly following two fatal 737 MAX 8 crashes in 2018 and 2019.
Rising geopolitical tensions have resulted in increased defense spending worldwide. Defense spending is one of the very few areas that have gained bipartisan support in the US.
On the commercial side, global air traffic continues to expand. The rising middle class in emerging economies and their growing incomes are expected to be key drivers of air travel demand in the future.
The iShares U.S. Aerospace & Defense ETF (ITA - Free Report) is a market-cap weighted ETF. Boeing (BA - Free Report) gets almost 17% weighting in the fund. Other top holdings include Lockheed Martin (LMT - Free Report) and RTX (RTX - Free Report) .
The SPDR S&P Aerospace & Defense ETF (XAR - Free Report) follows an equal-weighted index while the Invesco Aerospace & Defense Portfolio (PPA - Free Report) tracks a modified market cap weighted index of companies involved in the defense, military, homeland security and space industries.
Tune in to the podcast to learn more.
Make sure to be on the lookout for the next edition of the ETF Spotlight and remember to subscribe! If you have any comments or questions, please email podcast@zacks.com.
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Can Aerospace & Defense ETFs Rise Amid Ongoing Geopolitical Conflicts?
In this episode of ETF Spotlight, I speak with Tony Bancroft, portfolio manager of the Gabelli Commercial Aerospace & Defense ETF (GCAD - Free Report) , about the outlook for the aerospace and defense industry.
Boeing (BA - Free Report) shares have plunged about 20% since a part of a 737 Max 9 jet operated by Alaska Airlines (ALK - Free Report) blew out mid-flight, forcing the plane to make an emergency landing. This incident led to the grounding of many 737 MAX jets by the Federal Aviation Administration (FAA).
Last week, the FAA allowed the grounded jets to resume flying but imposed limits on Boeing’s 737 production. Boeing has continued to face questions about its quality control systems, particularly following two fatal 737 MAX 8 crashes in 2018 and 2019.
Rising geopolitical tensions have resulted in increased defense spending worldwide. Defense spending is one of the very few areas that have gained bipartisan support in the US.
On the commercial side, global air traffic continues to expand. The rising middle class in emerging economies and their growing incomes are expected to be key drivers of air travel demand in the future.
The iShares U.S. Aerospace & Defense ETF (ITA - Free Report) is a market-cap weighted ETF. Boeing (BA - Free Report) gets almost 17% weighting in the fund. Other top holdings include Lockheed Martin (LMT - Free Report) and RTX (RTX - Free Report) .
The SPDR S&P Aerospace & Defense ETF (XAR - Free Report) follows an equal-weighted index while the Invesco Aerospace & Defense Portfolio (PPA - Free Report) tracks a modified market cap weighted index of companies involved in the defense, military, homeland security and space industries.
Tune in to the podcast to learn more.
Make sure to be on the lookout for the next edition of the ETF Spotlight and remember to subscribe! If you have any comments or questions, please email podcast@zacks.com.