Source | Chat GPT
Defence stocks sits in that bucket which some investors won’t touch, along with tobacco, gambling etc. But if you’re open to the idea Europe is re-arming itself as the US pulls back as the world’s policeman and this should see significant spending on defence.
Further defence should be fairly resilient to global economic woes as wars don’t stop just because of a recession.
When looking for a global defence ETF I wanted one that was pure defence as a lot of companies operate in the sector, but some like Boeing for example have defence as a small part of their business.
The Global X Defense Tech ETF requires that in order to be included in the ETF 50% of revenue must be defence related, so no Boeing.
This ETF is still however 54.1% US followed by Germany 10.3%, France 8.0%, Britain 7.2%, South Korea 6.6% and Italy 6.0% with he top holdings as below.
Top holdings as at 08 April 2025
The ETF has run hard as can be seen from the chart below and we may see some more downside that could offer a better entry point.
Global X Defense Tech ETF | Weekly | 08 April 2025
A last point, while the defence sector may be fairly resilient from global economic woes two things to note. Firstly US tariffs could hurt inout costs and hence margins and profits. Secondly many in the ETF may also have other business divisions struggling under the tariffs and potential weaker economy that could hurt.
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| ETF name | Global X Defense Tech ETF |
| NYSE code | SHLD |
| ETF issuer | Global X |
| Issue date | 11 September 2023 |
| Total expense ratio (TER) | 0.5% |
| Tax-free savings account | NO |
| Market cap | US$1.28billion |
| Performance 1 year annualised | +40.93% |
| Performance since inception annualised | +50.27% |
| Dividend yield | 0.45% |
ETF blog
At Just One Lap, we are big fans of passive investment using ETFs. In this weekly blog, we discuss ETFs on the local market and the factors you need to consider when choosing an ETF. If you have wondered how one ETF differs from another, this is where you can find out. We explain which index each ETF tracks, what type of portfolio could benefit from holding each ETF, and how the costs will affect your bottom line.
