Investors choosing between ARK Space & Defense Innovation ETF (NYSEMKT:ARKX) and U.S. Global Jets ETF (NYSEMKT:JETS) must weigh a pure-play airline focus against a broader, tech-heavy space-and-defense strategy.
Both exchange-traded funds target the broader aerospace theme but through fundamentally different lenses. While the U.S. Global Jets ETF concentrates on the day-to-day operations of commercial aviation and global carriers, the ARK Space & Defense Innovation ETF expands its reach to orbital technology, suborbital flights, and defense innovation. Understanding these nuances is essential because the airline industry often responds to consumer travel demand, while space and defense innovation may be driven by government contracts and technological breakthroughs. This comparison explores how these differing exposures influence cost, risk profiles, and portfolio composition for long-term holders seeking to capture growth in the skies and beyond.
Snapshot (cost & size)
|
Metric |
JETS |
ARKX |
|---|---|---|
|
Issuer |
US Global |
ARK |
|
Expense ratio |
0.6% |
0.75% |
|
1-yr return (as of May 27, 2026) |
28.7% |
71.8% |
|
Dividend yield |
0.8% |
None |
|
Beta |
1.18 |
1.38 |
|
Assets under management (AUM) |
$865.2 million |
$717.3 million |
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 ARK Space & Defense Innovation ETF is the more expensive option, charging a 0.75% expense ratio compared to the 0.6% fee charged by the U.S. Global Jets ETF. While the 0.15 percentage point difference may seem minor, it could impact total returns as compounding takes effect over a long-term investment horizon.
Performance & risk comparison
|
Metric |
JETS |
ARKX |
|---|---|---|
|
Max drawdown (4 yr) |
(35.2%) |
(25.6%) |
|
Growth of $1,000 over 4 years (total return) |
$1,423 |
$2,411 |
What’s inside
The ARK Space & Defense Innovation ETF (ARKX) focuses on orbital and suborbital aerospace, with 56% of its portfolio in industrials and 27% in technology. It manages a portfolio of 45 holdings, and its largest positions include Rocket Lab (NASDAQ:RKLB) at 9.39%, Advanced Micro Devices (NASDAQ:AMD) at 7.75%, and L3Harris (NYSE:LHX) at 7.15%. This actively managed fund was launched in 2021.
The U.S. Global Jets ETF (JETS) tracks a more industry-specific group of 42 holdings, with 89% of its holdings in industrials. Its largest positions include Delta Air Lines (NYSE:DAL) at 12.66%, American Airlines Group (NASDAQ:AAL) at 12.62%, and United Airlines Holdings (NASDAQ:UAL) at 11.07%. The portfolio is designed to provide exposure to the entire global airline ecosystem, including regional carriers and aircraft manufacturers, which explains its heavy concentration in industrial companies. This fund was launched in 2015.
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Which looks like the better buy
The ARK Space & Defense Innovation ETF (ARKX) and U.S. Global Jets ETF (JETS) are both exchange-traded funds (ETFs). However, they cover slightly different market segments. Let’s explore how they stack up with one another.
First, there’s ARKX. This fund is focused on the space and defense sectors. Indeed, this fund leans into the emerging technology theme, with significant holdings in private space launch company Rocket Lab, semiconductor powerhouse AMD, and artificial intelligence (AI) stalwart Palantir. The fund has performed particularly well over the last year, generating a total return of nearly 72%. However, since its inception in 2021, the fund has generated a total return of 84%, with a compound annual growth rate (CAGR) of 12.6%. That’s slightly less than the benchmark S&P 500, which has generated a total return of 105%, with a CAGR of 14.9% over the same period. Finally, the fund has a hefty expense ratio of 0.75% and pays no dividend.
Next, there’s JETS. This fund covers the airline sector. Top holdings include the major U.S. carriers, such as American Airlines, Delta Air Lines, and United Airlines, as well as smaller carriers such as Allegiant Travel, Alaska Air, and SkyWest. The fund has underperformed since its inception in 2015. During that time, JETS has generated a total return of 28%, with a CAGR of only 2.3%. The S&P 500, by contrast, has generated a total return of 332% over the same period, with a CAGR of 14.1%. Lastly, the fund has an expense ratio of 0.60% and a dividend yield of 0.8%.
In summary, JETS and ARKX differ in many ways. ARKX is a growth-oriented fund, focused on emerging technologies. JETS is a classic sector fund that primarily covers the U.S. domestic air travel industry. ARKX has a significant performance edge, making it the choice for most growth-oriented investors. However, the fund’s high expense ratio (0.75%) may give cost-conscious investors pause.
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Jake Lerch has positions in Rocket Lab and has the following options: long December 2026 $30 puts on Rocket Lab. The Motley Fool has positions in and recommends Advanced Micro Devices, L3Harris Technologies, Palantir Technologies, and Rocket Lab. The Motley Fool recommends Alaska Air Group, Allegiant Travel, and Delta Air Lines. The Motley Fool has a disclosure policy.
ARKX vs. JETS: ARKX Outperforms JETS With Higher Returns was originally published by The Motley Fool
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: finance.yahoo.com
