Comments from U.S. Defense Secretary Pete Hegseth
-
U.S. will conclude operations under “America First” conditions.
-
Iran was building a shield for nuclear ambition
-
This is not an endless war.
-
Iran operation will include casualties.
-
Operation is not directed at Iraq and is not an endless war.
-
U.S. mission in Iran is to destroy Iran’s missiles, navy, and deny Tehran nuclear weapons capability.
-
Conflict is not a regime-change war, although he noted the regime “did change.”
-
We did not start this war, but under Trump we are finishing it
-
Iran has long range strike capability
The top US general Caine:
- This is not a single overnight operation.
- We expect to take additional losses.
- This is major combat operations
- Flow of forces to reaching continues
The flow of news will be focused on the war over the near term.
Of course, you go to war, you use stockpile of defense goods. So there is an economic stimulus to war in the rebuild. Of course there are losers too.
Airlines are the first:
- United airlines -6.59%
- American Airlines -6.18%
- Delta Air Lines -5.81%
- Southwest Airlines -4.19%
Hotels are losers as well:
- Marriot -4.66%
- Hilton -3.06%
- Booking Holdings -3.88%
- Airbnb -3.78%
Some defense companies that are beneficiaries:
- RTX Corp; +6.34%
- Lockheed Martin +5.15%
- Northrup Grumman: +4.64%
- Generarl Dynamic +2.23%
- Exxon +4.52%
- Shell +1.58%
- Chevron +3.56%
- Barrick Mining +2.21
What about the top U.S. Defense ETFs
ITA — The industry benchmark
Best for: Large-cap U.S. defense exposure
-
Largest defense ETF (~$15B+ assets)
-
Tracks U.S. aerospace & defense companies
-
Heavy exposure to prime contractors
Top holdings typically include:
-
Lockheed Martin
-
RTX (Raytheon)
-
Northrop Grumman
-
Boeing
-
General Dynamics
✅ Institutional favorite
✅ Direct play on Pentagon spending
⚠️ More concentrated in mega caps
PPA — Balanced exposure
Best for: Diversified defense allocation
-
Tracks SPADE Defense Index
-
Expense ratio ~0.58–0.61%
-
Modified weighting reduces dominance of largest firms
Why investors use it
-
Better diversification than ITA
-
Includes suppliers + mid-tier contractors
✅ More balanced risk profile
✅ Broad defense ecosystem exposure
XAR — Equal-weight strategy
Best for: Growth & smaller defense names
-
Equal-weighted holdings (unique structure)
-
Less dependent on a few giants
-
Expense ratio ~0.35%
-
Strong recent performance (+60% past year cited)
✅ Higher upside in defense cycles
⚠️ More volatility
SHLD — Next-generation warfare
Best for: Modern defense themes
Focus areas:
-
AI warfare
-
drones
-
cybersecurity
-
space defense
Highlighted as a newer defense-tech focused ETF alongside ITA/XAR/PPA .
✅ Exposure to future battlefield tech
⚠️ Less traditional contractor exposure
DFEN — Trading vehicle
Best for: Short-term tactical trades
-
3× leveraged defense ETF
-
Designed for daily trading, not long-term holding
⚠️ High risk / decay effects
This article was written by Greg Michalowski at investinglive.com.