ETF Talk: A Deep Dive into Aerospace & Defense ETF (ITA)

Contando Estrelas, CC BY-SA 2.0

The iShares U.S. Aerospace & Defense ETF (ITA) is a targeted fund that caters to investors seeking targeted exposure to one of the most strategic and resilient sectors: aerospace and defense.

Managed by BlackRock, this exchange-traded fund (ETF) aims to replicate the performance of the Dow Jones U.S. Select Aerospace & Defense Index. Its primary focus is on companies involved in manufacturing, assembling and distributing aircraft and defense-related equipment. For investors looking to tap into this critical industry, ITA is a compelling option.

ITA’s portfolio is market-cap weighted, which means the largest companies in the sector hold a significant share of the fund’s assets. This strategy ensures that the ETF closely mirrors the market movements of industry leaders.

As of now, ITA comprises 38 holdings, with a notable concentration in its top 10, which account for over 76% of the portfolio. Here are some of the major players featured in the fund:

GE Aerospace (GE): With a weight of 19.79%, this conglomerate is the ETF’s largest holding, reflecting its significance in the aerospace industry.
RTX Corp (RTX): Formerly known as Raytheon Technologies, this defense giant takes up 16.26% of the fund.
Boeing (BA): Known globally for its aircraft manufacturing, Boeing composes 9.43% of the portfolio.

This structure highlights ITA’s focus on established firms with significant influence in their respective markets.

Over the past year, ITA has demonstrated steady growth and resilience, particularly during volatile periods in broader markets. As of April 22, 2025, this fund has slid 8.02% in the last month, 7.14% over the last three months and 0.27% year-to-date. However, ITA rose 12.42% during the last year.

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These figures show that while ITA faced some challenges earlier in the year, its long-term trajectory remains strong, driven by increased defense budgets and a rebound in commercial aviation.

A technical analysis of ITA provides further context for its recent performance.

Chart courtesy of www.stockcharts.com

This chart illustrates ITA’s upward momentum in recent months, with key support levels holding firm. Investors and analysts will likely keep a close eye on the fund’s ability to break through resistance levels in the near term.

Investing in ITA offers a direct route to gain exposure to an essential sector that is both economically and geopolitically significant. Its focus on large-cap companies ensures that the fund captures the industry’s most influential players, offering a blend of growth potential and stability. However, it’s crucial to recognize that ITA’s concentrated portfolio can lead to higher volatility compared to more diversified ETFs. As always, prospective investors should weigh their risk tolerance and financial goals before committing capital.

Finally, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.

Jim Woods

Jim Woods is a 20-plus-year veteran of the markets with varied experience as a broker, hedge fund trader, financial writer, author and newsletter editor. Jim is the editor of Forecasts & Strategies, Tactical Trader, TNT Trader, Five Star Trader, Bullseye Stock Trader, and The Deep Woods. His books include co-authoring, “Billion Dollar Green: Profit from the Eco Revolution,” and “The Wealth Shield: How to Invest and Protect Your Money from Another Stock Market Crash, Financial Crisis or Global Economic Collapse.” He’s also ghostwritten many books and articles, as well as edited content for some of the investment industry’s biggest luminaries. His articles have appeared on many leading financial websites, including StockInvestor.com, InvestorPlace.com, Main Street Investor, MarketWatch, Street Authority, Human Events and many others. Jim formerly worked with Investor’s Business Daily founder William J. O’Neil, helping to author training courses in the CANSLIM stock-picking methodology. The independent firm TipRanks rates Jim the No. 3 financial blogger in the world (out of more than 6,000). TipRanks calculates that, since 2012, he's made 361 successful recommendations out of 499 total, earning a success rate of 72% and a +15.3% average return per recommendation. He is known in professional and personal circles as “The Renaissance Man,” because his expertise includes such varied fields as composing and performing music; Western horsemanship, combat marksmanship, martial arts, auto racing and bodybuilding. Jim holds a BA in philosophy from the University of California, Los Angeles, and is a former U.S. Army paratrooper. A self-described “radical for capitalism,” he celebrates the virtue of making money from his Southern California horse ranch.