Top 10 Defense ETFs to Consider in 2025: A Comprehensive Guide

The defense industry has always been one of the most significant sectors for investors looking to diversify their portfolios, offering long-term stability and substantial growth potential.

Defense Exchange-Traded Funds (ETFs) are an excellent way for investors to gain exposure to the defense sector. With geopolitical tensions and defense spending on the rise, defense ETFs are a compelling investment for 2025 and beyond.

This guide will highlight the top 10 defense ETFs to consider in 2025, their constituent stocks, and where you can purchase these ETFs.

iShares U.S. Aerospace & Defense ETF (ITA)

Stock Price (as of 2025): $154.79

What Stocks Does ITA Consist Of?
The iShares U.S. Aerospace & Defense ETF (ITA) tracks the performance of the U.S. aerospace and defense sector. This ETF includes a diverse range of companies involved in the manufacturing of military aircraft, weapons, and defense technologies.

• Top Holdings: Lockheed Martin (LMT), Boeing (BA), Northrop Grumman (NOC), Raytheon Technologies (RTX), General Dynamics (GD).
• Sector Exposure: Aerospace, defense, and cybersecurity, with a heavy focus on U.S. government contracts and international defense spending.

Invesco Aerospace & Defense ETF (PPA)

Stock Price (as of 2025): $116.71

What Stocks Does PPA Consist Of?
Invesco’s Aerospace & Defense ETF (PPA) is another excellent option for investors interested in gaining exposure to leading defense contractors. The ETF includes companies that are involved in the production of military hardware, technology, and equipment. Some of the largest holdings in PPA include Raytheon Technologies, General Dynamics, and L3 Technologies.

• Top Holdings: Raytheon Technologies (RTX), General Dynamics (GD), Lockheed Martin (LMT), Boeing (BA), L3 Technologies (LLL).
• Sector Exposure: Aerospace, defense, and cybersecurity sectors, with a focus on both large contractors and emerging defense tech companies.

SPDR S&P Aerospace & Defense ETF (XAR)

Stock Price (as of 2025): $166.26

What Stocks Does XAR Consist Of? (Sector Composition)
SPDR’s S&P Aerospace & Defense ETF (XAR) seeks to provide exposure to U.S.-based aerospace and defense companies. This ETF has a strong focus on companies that are key players in the defense sector.

• Top Holdings: Lockheed Martin (LMT), Northrop Grumman (NOC), General Dynamics (GD), Honeywell (HON), Textron (TXT).
• Sector Exposure: Aerospace and defense technologies, including cybersecurity and advanced weapons systems.

Direxion Daily Aerospace & Defense Bull 3X Shares (DFEN)

Stock Price (as of 2025): $32.27

What Stocks Does DFEN Consist Of? (Sector Composition)
The Direxion Daily Aerospace & Defense Bull 3X Shares (DFEN) ETF is a leveraged fund that aims to return three times the daily performance of the Aerospace & Defense Select Sector Index.

This makes DFEN a highly volatile ETF, designed for investors with a higher risk tolerance. DFEN is suitable for those looking to make short-term gains based on daily movements in defense stocks.

• Top Holdings: Lockheed Martin (LMT), Northrop Grumman (NOC), Raytheon Technologies (RTX), General Dynamics (GD), Boeing (BA).
• Sector Exposure: Aerospace and defense, with an emphasis on U.S. companies with government contracts.

SPDR S&P Kensho Future Security ETF (FITE)

Stock Price (as of 2025): $65.82

What Stocks Does FITE Consist Of? (Sector Composition)
The SPDR S&P Kensho Future Security ETF (FITE) focuses on investing in firms that provide advanced security technologies, including defense, cybersecurity, and artificial intelligence (AI). The ETF tracks companies at the intersection of cutting-edge technologies and national security, offering exposure to innovative firms that are leading the future of defense.

• Top Holdings: CrowdStrike (CRWD), Palantir Technologies (PLTR), Booz Allen Hamilton (BAH), Leidos Holdings (LDOS), Lockheed Martin (LMT).
• Sector Exposure: Cybersecurity, AI-driven defense technologies, aerospace, and national security.

Global X Defense Tech ETF (SHLD)

Stock Price (as of 2025): Not available

What Stocks Does SHLD Consist Of? (Sector Composition)

The Global X Defense Tech ETF (SHLD) invests in companies that specialize in innovative defense technologies.

This ETF focuses not only on traditional defense companies but also on firms involved in the development of new technologies like AI, automation, and cybersecurity. With rising tensions in global politics and technological advancements, SHLD provides exposure to companies at the forefront of military innovation.

• Top Holdings: Northrop Grumman (NOC), Lockheed Martin (LMT), General Dynamics (GD), L3 Technologies (LLL), Palantir Technologies (PLTR).
• Sector Exposure: Advanced defense systems, cybersecurity, aerospace, and AI technologies for defense.

First Trust Nasdaq Cybersecurity ETF (CIBR)

Stock Price (as of 2025): Not available

What Stocks Does CIBR Consist Of? (Sector Composition)
CIBR focuses exclusively on cybersecurity companies, which have become a critical component of modern defense strategies. As cyber threats continue to increase, cybersecurity has become an integral part of national security, and this ETF captures that growing market.

• Top Holdings: Palo Alto Networks (PANW), CrowdStrike (CRWD), Check Point Software (CHKP), Zscaler (ZS), Fortinet (FTNT).
• Sector Exposure: Cybersecurity, national security, and enterprise security.

Amplify Cybersecurity ETF (HACK)

Stock Price (as of 2025): Not available

What Stocks Does HACK Consist Of? (Sector Composition)
The Amplify Cybersecurity ETF (HACK) targets a diversified group of companies in the cybersecurity field. This ETF includes companies focused on providing defense against cyber-attacks, making it a unique play in the broader defense ETF sector. As global cybersecurity risks continue to rise, the demand for specialized defense companies grows. The ETF holds companies that provide infrastructure protection, cloud security, and data protection solutions.

• Top Holdings: CrowdStrike (CRWD), Palo Alto Networks (PANW), Zscaler (ZS), Fortinet (FTNT), Check Point Software (CHKP).
• Sector Exposure: Cybersecurity, with some exposure to AI and cloud security.

VanEck Defense ETF (DFNS)

Stock Price (as of 2025): Not available

What Stocks Does DFNS Consist Of? (Sector Composition)
VanEck’s Defense ETF (DFNS) is a fund that focuses on companies directly involved in manufacturing defense equipment and technology. This ETF provides exposure to companies within the traditional aerospace and defense sectors, but it also includes firms engaged in newer technologies like autonomous vehicles, AI for defense, and drones. It is a comprehensive ETF for those looking for a broad exposure to the global defense market.

• Top Holdings: Lockheed Martin (LMT), Northrop Grumman (NOC), Boeing (BA), Raytheon Technologies (RTX), General Dynamics (GD).
• Sector Exposure: Aerospace, defense, and next-generation defense technologies.

HanETF Future of Defence ETF (NATO)

Stock Price (as of 2025): Not available

What Stocks Does NATO Consist Of? (Sector Composition)
The HanETF Future of Defence ETF (NATO) offers exposure to defense companies that are actively involved in shaping the future of defense technologies. From cybersecurity to AI-driven defense systems, NATO captures the cutting-edge of global defense innovation. The ETF includes companies involved in advanced military technology, satellite systems, and drone technologies.

• Top Holdings: Northrop Grumman (NOC), Lockheed Martin (LMT), General Dynamics (GD), Thales Group (HO), Leonardo (LDO).
• Sector Exposure: Aerospace, AI, defense innovation, cybersecurity, and military technology.

What Are the Best Stock Brokers to Buy Defense ETFs From?

When it comes to investing in defense ETFs, choosing the right stockbroker is crucial for a smooth and efficient investing experience. Factors such as commission fees, platform usability, access to a wide selection of defense industry ETFs, and global market reach should be considered.

Here’s a list of some of the best stock brokers that allow you to invest in defense stocks ETFs and provide excellent access to a range of defense ETFs:

1. Interactive Brokers

Pros:

• Global Market Access: Interactive Brokers offers access to a wide range of markets, including U.S. and international defense industry ETFs. This is perfect for those looking to diversify their portfolios by including both local and global defense stocks ETFs.
• Advanced Tools and Features: The platform provides sophisticated trading tools and research features, ideal for experienced investors looking to make informed decisions when investing in defense ETFs.
• Low Costs: Competitive commission rates allow investors to minimize trading fees, making it cost-effective for those who trade frequently.
• Extensive ETF Selection: Interactive Brokers provides an expansive selection of defense ETFs, including options focusing on aerospace, defense technology, and cybersecurity.

Cons:

• Complex Platform for Beginners: While the advanced tools are beneficial for experienced traders, newcomers might find the platform overwhelming.
• Higher Minimums for Some Accounts: Some account types require a higher initial deposit, which might not be ideal for beginners or smaller investors.

2. eToro

Pros:

• User-Friendly Interface: eToro offers an intuitive, easy-to-use platform, making it a great choice for beginners interested in buying defense stocks ETFs.
• Commission-Free Trading: eToro allows commission-free trading, meaning you can buy and sell defense ETFs without paying extra fees, which is ideal for cost-conscious investors.
• Social Trading Features: eToro’s social trading feature allows you to follow other traders and replicate their strategies. This can be especially helpful when selecting the best defense ETFs to invest in.
• Global Access to ETFs: eToro provides access to a broad range of defense ETFs, making it easy to gain exposure to different sectors within the defense industry.

Cons:

• Limited Advanced Tools: While the platform is great for beginners, it lacks the advanced tools and research features that experienced traders may require when analyzing complex defense ETFs.
• Withdrawal Fees: eToro charges fees for withdrawals, which may be a downside for those who need frequent access to their funds.

3. IG

Pros:

• Comprehensive Research Tools: IG offers some of the best research and analytical tools, which are ideal for investors looking to track the performance of defense stocks ETFs and other investments in the defense industry.
• Wide Range of ETFs: IG gives investors access to a diverse selection of defense ETFs, including those focused on aerospace, cybersecurity, and military technologies.
• Customizable Platform: The platform is highly customizable, allowing investors to tailor their trading experience and find the best defense ETFs for their portfolio.
• Trusted Reputation: IG has a solid reputation for being a reliable and secure stockbroker with a long-standing presence in the market.

Cons:

• Higher Fees on Certain Trades: While IG offers a range of defense industry ETFs, some trades can incur higher fees compared to other brokers.
• Complex Platform for Beginners: IG’s advanced features might be overwhelming for new investors who are just starting with defense ETFs.

4. Fidelity Investments

Pros:

• Low-Cost Trading: Fidelity offers competitive fees, making it an affordable option for those who want to invest in defense stocks ETFs without excessive costs.
• Educational Resources: Fidelity provides an array of educational resources, making it a great choice for new investors who are looking to learn about defense ETFs and how they fit into their overall investment strategy.
• Wide Selection of ETFs: Fidelity offers a broad variety of defense ETFs, from aerospace and military companies to cybersecurity firms.
• Excellent Customer Service: Fidelity is well-known for its top-notch customer service, providing strong support for any questions related to buying defense ETFs.

Cons:

• Limited Advanced Trading Tools: While great for beginners, Fidelity’s platform might lack some of the advanced tools that more experienced investors look for when managing defense ETFs.
• Higher Minimums on Certain Accounts: Some account types may require higher minimum balances, which might not be ideal for smaller investors interested in defense ETFs.

5. Charles Schwab

Pros:

• Low-Cost and Commission-Free Trades: Charles Schwab offers commission-free trading on many defense ETFs, allowing you to invest in the defense sector without the worry of high fees.
• Easy-to-Navigate Platform: The user-friendly platform makes it easy for both new and seasoned investors to buy defense industry ETFs with minimal hassle.
• Solid Research Tools: Charles Schwab offers a variety of research tools, including information on defense stocks ETFs, that can help investors make more informed decisions.
• Great Customer Service: Known for excellent customer support, Charles Schwab is ideal for investors who prefer good customer service when purchasing defense ETFs.

Cons:

• Limited Access to International Markets: While Charles Schwab offers a wide range of defense ETFs, its international market options may not be as extensive as other brokers like Interactive Brokers.
• No Social Trading: Unlike eToro, Charles Schwab does not offer social trading features, meaning you won’t have the option to follow other investors’ strategies when choosing defense stocks ETFs.

Conclusion

In 2025, defense ETFs are shaping up to be an attractive investment option. They provide diversified exposure to defense-related industries, including aerospace, cybersecurity, military technologies, and advanced defense systems. By investing in these top defense ETFs, you gain access to a broad array of companies that are essential in the defense sector, such as Lockheed Martin, Northrop Grumman, and Raytheon Technologies.

Before investing in defense ETFs, it’s important to do thorough research, especially with the political and economic environment always changing. Ensure that you choose the right stockbroker based on fees, access to global markets, and the range of defense ETFs available.

For UK investors, Interactive Brokers, IG, and eToro are highly recommended platforms offering commission-free trading and access to top defense ETFs.

FAQ

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your own research and consult with a professional before making any investment decisions. Stock investments involve risk, and you should only invest what you can afford to lose.