Opinions
David Driscoll
SPDR® S&P Aerospace & Defense ETF
XAR-N
BUY
Apr 04, 2016
$51.868
Stock price when the opinion was issued
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COMMENT
ITA-N vs. XAR-N He knows the defence sector. A problem in defence is the huge run-up in Boeing, which dominates defence. ITA has a cap system in place to deal with this over-concentration in a few defence stocks, but XAR is odd because it's equal-weighted, therefore carries more risk. He prefers ITA.
E.T.F.'s
TOP PICK
With trade wars, comes wars, he says. With the Trump Administration spending $700 million defense spending bill, the highest investment in a decade, he expects good things. It is a great technology play without the massive overvaluations, due to the anticipated use of robotic and other advanced technology.
E.T.F.'s
Defence stocks. XAR-N Is an aerospace and defence ETF. The problem with an alternate ETF was that its biggest holding was Boeing. Each defence stock does something different. Operating margins are around the mid double digits.