Better Returns, Lower Risk: Invesco Aerospace ETF Tops Jets ETF

Flight or fight? In looking at your investment portfolio, you have the choice of both.

Invesco Aerospace & Defense ETF (NYSEMKT:PPA) offers broad exposure to defense contractors and aerospace manufacturing with lower historical volatility, while U.S. Global Jets ETF (NYSEMKT:JETS) provides a pure-play, more concentrated bet on global airline operators.

Investors looking for exposure to flight-related industries generally choose between two distinct paths: commercial travel or military defense. While both funds are housed primarily within the industrial sector, their underlying economic drivers differ significantly, ranging from consumer leisure demand and fuel costs to national security budgets and long-term government defense contracts.

Snapshot (cost & size)

Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.

The Invesco fund is slightly more affordable with a 0.58% expense ratio compared to the 0.60% charged by the U.S. Global fund. However, the airline-focused ETF provides a higher payout, yielding 0.80% over the trailing 12 months at its recent price of $27.55, versus the 0.40% yield from the defense fund when it was trading around $166.

Performance & risk comparison

What's inside

The Invesco Aerospace & Defense ETF holds 60 positions and tracks the SPADE Defense Index, focusing on firms vital to U.S. homeland security and aerospace support. Its largest positions include Boeing Co. (NYSE:BA) at 8.1%, RTX Corp. (NYSE:RTX) at 7.91%, and GE Aerospace (NYSE:GE) at 7.77%. The portfolio is almost 94% Industrials, with the balance in technology and communication services. This fund was launched in 2005 and has a trailing-12-month dividend of $0.66 per share.

The U.S. Global Jets ETF offers a more concentrated portfolio of 50 positions, including both airline operators and aircraft manufacturers worldwide. Its largest positions include Delta Air Lines Inc (NYSE:DAL) at 12.69%, American Airlines Group Inc (NASDAQ:AAL) at 12.01%, and United Airlines Holdings Inc (NASDAQ:UAL) at 11.57%. The sector mix is 91% Industrials, 7% Consumer Cyclical, and 2% Technology. This fund was launched in 2015 and has a trailing-12-month dividend of $0.23 per share.

Which is the better buy?

The Invesco Aerospace & Defense ETF is the better buy, having outpaced the U.S. Global JETS fund year-to-date, over the past three years, and over the previous five years. In the three years through March 31, 2026, PPA has returned 27.87%, while avancing 17.85% over the previous five years.
By comparison, the U.S. Global JETS ETF has returned 17.38% over the past three years and 2% over the past five years.

The primary difference is that JETS is focusing solely on the commercial aerospace business, mainly consumer travel on aircraft. That’s a boom-and-bust industry, where intense competition over airfare pricing makes it difficult for most airlines to post consistent profits.

The Invesco PPA fund holds a number of stocks not seen in JETS, including defense contractors L3Harris Technologies (NYSE:LHX), General Dynamics (NYSE:GD), and Northrop Grumman (NYSE:NOC). All of those are stocks benefiting from the U.S. increasing defense spending amid multiple military campaigns in recent years.

With lower volatility than JETS, as indicated by its lower maximum drawdown, PPA is the choice for 2026.

For more guidance on ETF investing, check out the full guide at this link.

Brendan Coffey has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Boeing, GE Aerospace, L3Harris Technologies, and RTX. The Motley Fool recommends Delta Air Lines. The Motley Fool has a disclosure policy.