The aerospace & defense industry does not always receive heightened investor attention because it does not typically showcase growth prospects as solid as the technology and other high growth industries. However, considering current market volatility on concerns about aggressive interest rate increases to control multi-decade high inflation, defense stocks could provide the stability investors are seeking thanks to long-term contracts these companies have with the government.
Investors’ interest in defense stocks is evident from the Invesco Aerospace & Defense ETF’s (PPA) 6.6% gains over the past six months, versus the SPDR S&P 500 Trust ETF’s (SPY) 9.5% loss over this period.
