iShares Aerospace ETF vs Tema Space Innovators ETF

Source The Motley Fool

Key Points

  • iShares U.S. Aerospace & Defense ETF offers a significantly lower expense ratio of 0.37% compared to 0.75% for Tema Space Innovators ETF.

  • Tema Space Innovators ETF provides concentrated exposure to 37 holdings in space commerce, while iShares U.S. Aerospace & Defense ETF holds 50 stocks in the broader defense sector.

  • iShares U.S. Aerospace & Defense ETF has historically demonstrated a smaller maximum drawdown of (19.5%) compared to (51.0%) for Tema Space Innovators ETF.

  • 10 stocks we like better than Tema ETF Trust - Tema Space Innovators ETF ›

Tema Space Innovators ETF (NYSEMKT:NASA) targets high-growth space commercialization with a concentrated, active approach, while iShares U.S. Aerospace & Defense ETF (CBOE:ITA) provides more established, lower-cost exposure to traditional defense giants.

Mission control operators monitor a rocket launch on multiple screens.

Image source: Getty Images.

Investors seeking to capitalize on the final frontier must decide between focused innovation and established industrial strength. While the iShares U.S. Aerospace & Defense ETF is the more established choice with $11.8 billion in assets under management (AUM), the Tema Space Innovators ETF offers a focused $1.0 billion pool for those specifically targeting extraterrestrial ventures.

Snapshot (cost & size)

MetricNASAITA
IssuerTemaiShares
Share price$21.25 (as of 2026-10-15)$206.92 (as of 2026-10-15)
Expense ratio0.75%0.37%
Dividend yieldn/a0.3%
AUM$1.0 billion$11.8 billion

Cost is a primary differentiator between these two strategies. The iShares U.S. Aerospace & Defense ETF is notably more affordable with a 0.37% expense ratio, while the Tema Space Innovators ETF charges 0.75% for its actively managed portfolio.

Performance & risk comparison

MetricNASAITA
Max drawdown (5 yr)(51.0%)(19.5%)

What's inside

The iShares U.S. Aerospace & Defense ETF seeks to track a market-cap-weighted index of domestic companies involved in the aviation and defense industries. Its portfolio is composed entirely of aerospace and defense holdings, containing 50 total stocks. Its largest positions include GE Aerospace (NYSE:GE) at 20.96%, RTX (NYSE:RTX) at 16.31%, and Boeing (NYSE:BA) at 7.60%. The fund was launched in 2006.

The Tema Space Innovators ETF takes a specialized approach, utilizing fundamental research to select firms poised to profit from space expansion. While its specific sector breakdown is not reported, the fund maintains 37 positions targeting satellite manufacturing and launch services. Top holdings include SpaceX SPV Exposure at 17.91%, Rocket Lab Corp (NASDAQ:RKLB) at 9.47%, and Space Exploration Technologies Corp (NASDAQ:SPCX) at 9.15%. This fund was launched in 2026.

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

Which looks like the better buy

Many investors will find the iShares Aerospace ETF the better choice. It costs less and holds established aerospace and defense companies, while the Tema Space Innovators ETF may appeal to investors seeking greater exposure to commercial space, even though it's more volatile.

ITA carries an expense ratio of 0.37% a year -- compared to NASA's 0.75% -- and includes giants like GE Aerospace, RTX, and Boeing. Each is an established business that earns money from areas such as defense, aircraft, and maintenance.

NASA focuses more directly on space businesses, including satellite and launch companies. While it may have greater growth potential, it has fewer holdings, a shorter track record, and exposure to companies with less certain future profits. In addition, NASA's large position in SpaceX adds concentration risk.

The bottom line: Choose ITA for broader exposure to established companies at a lower cost, and choose NASA only if you want a focused, higher-risk investment in the commercial space industry.

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Dana George has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Boeing, GE Aerospace, RTX, and Rocket Lab. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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