With over $9.1 billion in assets under management, the iShares U.S. Aerospace & Defense ETF (ITA -0.42%) is the largest U.S.-listed exchange-traded fund (ETF) focused on the aerospace and defense sector.
Launched in May 2006 and backed by the iShares brand, ITA has a long track record and strong name recognition. But in the years since its debut, a growing number of competing aerospace and defense ETFs have entered the market, giving investors more choice than ever.
So is ITA still the default go-to for aerospace and defense exposure? Here’s what investors need to know to make an informed decision in 2025.
Exchange-Traded Fund (ETF)
Overview
What is iShares U.S. Aerospace & Defense ETF?
iShares U.S. Aerospace & Defense ETF is a passive ETF that tracks the Dow Jones U.S. Select Aerospace & Defense Index. This means it does not try to pick individual stocks but instead aims to replicate the holdings and performance of the index.
The benchmark consists of 37 defense companies selected from the broader Dow Jones U.S. Broad Stock Market Index. It is market capitalization-weighted with some modifications, but in general, larger companies receive a higher weighting in the portfolio.
This ETF is also one of the more liquid ETFs in the aerospace and defense niche. As of August 2024, it traded with a minimal 0.05% 30-day median bid-ask spread, meaning the gap between the buying and selling price is very small.
It also sees an average of about 664,000 shares traded over a 30-day period, making it easy for most investors to enter or exit positions without significant price impact.
How to invest
How to buy iShares U.S. Aerospace & Defense ETF
- Step 1: Open your brokerage app: Log in to your brokerage account where you handle your investments.
- Step 2: Search for the ETF: Enter the ticker or ETF name into the search bar to bring up the ETF's trading page.
- Step 3: Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this ETF.
- Step 4: Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Step 5: Submit your order: Confirm the details and submit your buy order.
- Step 6: Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Holdings
Holdings of iShares U.S. Aerospace & Defense ETF
Aerospace and defense companies almost entirely fall within the industrials sector, so iShares U.S. Aerospace & Defense ETF's portfolio is dominated by these names.
Within the group, holdings can be pure-play aerospace, pure-play defense, a mix of both, components manufacturers, intelligence firms, or conglomerates with divisions spanning multiple categories.
As of August 2025, this ETF held 37 companies. On average, they traded at 5.92 times price-to-book and 39.71 times price-to-earnings.
This is a fairly volatile portfolio, with a three-year standard deviation of 19.84%, although its three-year beta is 0.92, meaning it has tended to move slightly less than the overall market.
Because it is market cap-weighted, the bigger defense stocks carry much heavier allocations than others due to their size. The top holdings as of August 2025 were:
- GE Aerospace (GE -1.5%)
- RTX (RTX 0.11%)
- Boeing (BA 0.47%)
- Northrop Grumman (NOC 0.64%)
- General Dynamics (GD 0.18%)
- L3Harris Technologies (LHX -0.33%)
- Axon Enterprise (AXON 1.12%)
- Howmet Aerospace (HWM -0.13%)
- TransDigm Group (TDG 0.68%)
- Lockheed Martin (LMT -0.15%)
Should I invest?
Should I invest in iShares U.S. Aerospace & Defense ETF (ITA)?
When iShares U.S. Aerospace & Defense ETF launched in 2006, it was one of the few industry-specific ETFs available, and its first-mover advantage helped it build significant assets under management and trading volume. At the time, that made it an attractive go-to for aerospace and defense exposure.
Today, the case is less compelling. The ETF’s exposure is narrow, lacking international defense companies, especially from Europe. Its market cap weighting also concentrates holdings in a handful of major U.S. contractors, reducing diversification.
It’s also important to note that while defense stocks have been strong performers, this ETF allocates heavily to aerospace, with many holdings tied to commercial aviation rather than purely defense-related revenue.
If your main priorities are liquidity and a long track record, this ETF still holds an advantage. But in 2025, its approach is relatively limited and could be considered outdated compared to newer, more globally diversified options.
Dividends
Does iShares U.S. Aerospace & Defense ETF pay a dividend?
Yes. As of August 2025, the ETF paid a quarterly distribution. Its 30-day SEC yield is 0.43%, which is about average for the aerospace and defense category. Many companies in this space reinvest heavily in research and development (R&D) rather than distributing excess cash flow to shareholders.
Expense Ratio
What is iShares U.S. Aerospace & Defense ETF’s expense ratio?
The expense ratio for ITA is 0.38%, which works out to $38 annually for every $10,000 invested. This is about average for sector- or industry-specific ETFs and is neither particularly high nor low.
Expense Ratio
Historical performance
Historical performance of iShares U.S. Aerospace & Defense ETF (ITA)
| 1y | 3y | 5y | 10y | |
| Net Asset Value | 38.25% | 24.92% | 21.29% | 13.97% |
| Market Price | 38.29% | 24.88% | 21.29% | 13.97% |
Related investing topics
The bottom line
ITA remains the standard for aerospace and defense ETFs, but not because it’s a standout performer. It’s more that ITA represents what you should expect from an average fund in this category.
The expense ratio is reasonable, and it holds all the major U.S. prime defense contractors. However, the market cap-weighted methodology creates concentration risk in the largest holdings, and the fund offers no European diversification.
As of August 2025, the portfolio traded at elevated price-to-book and price-to-earnings ratios after years of defense contractors being bid up during multiple global conflicts.
On the plus side, ITA is tax-efficient with a low dividend yield, although that yield may not appeal to income-focused defense investors. It remains highly liquid, making it suitable for active traders.
FAQ
Investing in iShares U.S. Aerospace & Defense ETF (ITA) FAQs
What is the ticker for iShares US Aerospace & Defense ETF?
The ticker is ITA.
How can I invest in iShares ETFs?
You can invest in the ETFs through most participating brokerage platforms, buying shares as you would any other stock.
Is ITA ETF a good investment?
ITA may be a good investment for capitalizing on further momentum in large U.S. aerospace and defense contractors, although valuations are rich.
Where is ITA traded?
ITA is traded on the CBOE BZX and NYSE exchanges.
