Which Aerospace ETF is the Better Buy in 2026: Invesco Aerospace & Defense or U.S. Global Jets?

The Invesco Aerospace & Defense ETF (NYSEMKT:PPA) offers broad exposure to military contractors with lower price volatility, while the U.S. Global Jets ETF (NYSEMKT:JETS) targets the concentrated recovery and global growth of airline operators.

Investors looking for industrial sector exposure often choose between travel-centric funds or those focused on national security. While JETS concentrates on the global airline ecosystem, PPA provides a wider net over defense contractors and aerospace manufacturers. This analysis compares their performance, costs, and risk profiles.

Snapshot (cost & size)

Metric	JETS	PPA
Issuer	US Global	Invesco
Share price	$29.32 (as of 2026-07-23)	$174.26 (as of 2026-07-23)
Expense ratio	0.60%	0.58%
1-yr return (as of 2026-07-23)	15.70%	19.10%
Dividend yield	0.80%	0.40%
Beta	1.20	0.74
AUM	$851.4 million	$8.0 billion
Beta measures price volatility relative to the S&P 500; beta is calculated from monthly returns over the available fund history (up to five years). The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.

With an expense ratio of 0.58%, the Invesco fund is slightly more affordable than the 0.60% charged by the U.S. Global fund. In terms of income, the U.S. Global fund provides a higher trailing payout for yield-focused investors.

Performance & risk comparison

Metric	JETS	PPA
Max drawdown (5 yr)	(40.40%)	(18.40%)
Growth of $1,000 over 5 years (total return)	$1,293	$2,411

What's inside

Invesco Aerospace & Defense ETF weights its portfolio toward Industrials at 90% with Technology at 10%. It holds 61 securities, and its largest positions include GE Aerospace (NYSE:GE) at 7.3%, RTX (NYSE:RTX) at 7.2%, and Boeing (NYSE:BA) at 6.8%. The fund launched in 2005. Invesco Aerospace & Defense ETF has paid $0.64 per share over the trailing 12 months, which on its recent ~$174.26 share price works out to a 0.40% yield.

U.S. Global Jets ETF allocates its assets primarily to Industrials at 89%, Consumer Cyclical at 8%, and Technology at 3%. It maintains 48 holdings, and top holdings include American Airlines (NASDAQ:AAL) at 10.89%, United Airlines Holdings (NASDAQ:UAL) at 11.1%, and Southwest Airlines (NYSE:LUV) at 10.7%. The fund launched in 2015. U.S. Global Jets ETF has paid $0.23 per share over the trailing 12 months, which on its recent ~$29.32 share price works out to a 0.80% yield.

Which fund is the better buy?

Each of these ETFs provides access to the aerospace industry, but they have key differences an investor should examine before deciding on which one to invest in.

One primary difference is that JETS, the U.S. Global fund, 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. JETS is also much more weighted to small and mid-cap stocks. The ETF holds 35% of its portfolio in small caps and 44% in mid cap stocks.

The Invesco fund, PPA, holds a number of stocks not seen in JETS, including defense contractors L3Harris Technologies, 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. It is 61% in large cap stocks, 34% in mid caps, and the balance in small caps.

The primary differentiator is performance. By virtue of its larger exposure to small cap JETS has been enjoying the benefits of the historic rally in small cap stocks, which are having their best year since 1991. It is up 18.4% year to date compared to 14% fdor PPA. Over the past 52 weeks it has gained 46.1% while PPA has posted a 25.4% increase. Longer-term, however PPA has been the better performing fund, beating JETS in the 3-, 5-, and 10-year look-backs. PPA has returned an annualized 17.8% over the past decade, compared to 5.2% for JETS.

Still, recent performance for JETS stands out, and it is unlikely small caps will return to their market-lagging ways, at least not to the extent they had been out of favor. JETS is the better ETF to buy.

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 and Southwest Airlines. The Motley Fool has a disclosure policy.