Which Is the Better Aerospace and Defense ETF, Invesco's PPA or State Street's XAR?

PPANYSE ArcaInvesco Aerospace & Defense ETF·May 30, 2026, 03:16 AM·The Motley Fool

Impact

(High)

Sentiment

(Positive)

Stonvex AI Summary

Invesco's PPA and State Street's XAR are competing aerospace and defense ETFs with different strategic approaches. PPA holds 61 positions with lower volatility and charges 0.58% in fees, while XAR uses equal-weighting methodology, delivered superior 1-year returns of 50.97% compared to PPA's 35.37%, and charges lower fees at 0.35%.

Positive

■PPA offers broader diversification with 61 holdings and lower volatility, making it suitable for risk-averse investors seeking stability in the aerospace and defense sector
■XAR demonstrates superior recent performance with 50.97% 1-year returns and lower expense ratio of 0.35%, potentially delivering better long-term value

Negative

■PPA's higher 0.58% expense ratio results in greater fee drag compared to XAR's 0.35%, impacting long-term returns
■XAR exhibits higher volatility and greater drawdown risk due to equal-weighting methodology, which may not suit conservative investors

Original excerpt

Invesco's PPA and State Street's XAR are two aerospace and defense ETFs with different strategies. PPA offers lower volatility and broader diversification with 61 holdings but charges a higher 0.58% expense ratio. XAR uses equal-weighting methodology, delivered superior 1-year returns (50.97% vs 35.37%), and has lower fees at 0.35%, but exhibits higher volatility and greater drawdown risk. The choice depends on investor risk tolerance and cost preferences.

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Summary and sentiment are generated by AI for educational purposes. Always verify with the original source before making investment decisions.