"The SPDR S&P Aerospace & Defense ETF (XAR) tracks the S&P Aerospace & Defense Select Industry Index using equal-weight methodology, meaning every one of its 41 positions receives roughly the same allocation. This design choice is the fund's defining feature, allowing broad coverage of defense primes, mid-tier suppliers, space launch companies, and drone manufacturers in a single vehicle."
"XAR's equal-weight structure has delivered impressive returns, with nearly 79% growth over the past year and about 439% over the last decade. This performance reflects the sector's long-term growth and the structural tailwind of rising global defense budgets, driven by surging defense budgets and renewed investor appetite for the sector."
NATO's European allies and Canada raised defense spending by approximately 20% in 2025. The SPDR S&P Aerospace & Defense ETF (XAR) offers an equal-weight approach, allocating capital evenly across 41 positions. This structure allows investors to gain exposure to various defense companies, including primes and mid-tier suppliers. The fund has performed well, returning nearly 79% over the past year and 439% over the last decade, driven by increased defense budgets and geopolitical tensions. The fund has a low expense ratio and minimal income, focusing on price appreciation for returns.
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