ITA vs ARKX: Can an Earthbound Aerospace ETF Outpace a Space Fund?
One fund charges less than half the fees of its rival, yet the pricier active option has been far more volatile over five years.
The iShares U.S. Aerospace & Defense ETF (ITA) and the ARK Space & Defense Innovation ETF (ARKX) are two distinct investment vehicles in the aerospace and defense sector. ITA is a passive, index-based fund that seeks to replicate a benchmark index of U.S. companies involved in aviation and defense industries. It offers a lower expense ratio of 0.37% and is heavily weighted towards large-cap stocks.
On the other hand, ARKX is an actively managed fund that targets long-term capital appreciation by investing in companies leading space exploration. It carries a higher expense ratio of 0.75% and is also heavily focused on growth equities, with a mix of large, mid, and small-cap stocks. While ARKX has outperformed ITA over the past three years, its higher volatility and lower returns over the past five years make ITA the better choice for investors seeking a more stable investment with a longer track record of solid returns.
Written by urgent.news from Motley Fool's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
