First Trust Indxx Aerospace & Defense ETF

MISL

Market cap $208M

Launched on October 25, 2022, the First Trust Indxx Aerospace & Defense ETF (MISL) is a passively managed exchange traded fund designed to provide a broad exposure to the Industrials - Aerospace & Defense segment of the equity market.

Defense spending hit a record $2.72T in 2024, boosting aerospace sector earnings as global tensions drive military budgets higher. ETFs like ITA, PPA and XAR are likely to gain.

Despite geopolitical tensions, defense stocks like those in the First Trust Indxx Aerospace & Defense ETF (MISL) have declined due to fears of budget cuts under President Trump's DOGE initiative. The proposed $895 billion defense budget for 2025 contradicts market fears, suggesting defense spending cuts are unlikely given strong congressional resistance and vested state interests. MISL's recent underperformance and high volatility are likely temporary, with a long-term bullish outlook based on sustained defense spending and the potential for faster AUM growth compared to peers.

Investors can take advantage of beaten-down prices because the second Trump administration is likely to boost stocks.

Aerospace and defense ETFs have surged in the past year — and are up so far this week even as the U.S. stock market has broadly stumbled.

As we face the last quarter of 2024, interest rates are finally heading down, kicked off by a 50 basis point Fed cut, the election race is too close to call, and global geopolitical instability remains a risk factor.

Like many analysts and investors, I'm always searching for the next big idea—whether it's a new company that creates a path to a whole new industry, an innovative ETF, or a new megatrend. I'm still an advocate of crypto, artificial intelligence, and other disruptive technologies, but sometimes good investment ideas aren't always obscure.