5 min readBy Beqa Bumbeishvili ETF Insider
How does the PPA ETF work?
The PPA ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
The Invesco Aerospace & Defense ETF (PPA) is managed by Invesco Capital Management LLC. Established to provide investors with exposure to the aerospace and defense sector, PPA invests at least 90% of its total assets in securities that make up the SPADE Defense Index. SPADE Indexes LLC is responsible for compiling and maintaining this index, which consists of U.S. companies involved in various aspects of defense, military, national/homeland security, and government space operations. The index includes companies specializing in military aircraft, naval vessels, armored vehicles, secure communications, intelligence, reconnaissance, and more. As of June 30, 2022, the index had 55 constituents, with market capitalizations ranging from approximately $241 million to $142.9 billion. PPA employs a full replication methodology to track the index and may concentrate its investments in the aerospace and defense industry, reflecting the index's composition.
The Invesco Aerospace & Defense ETF (PPA) primarily focuses on investments in companies involved in the defense sector, and its dividend distribution is influenced by the performance and dividend policies of the constituent companies. The ETF typically distributes dividends on a regular basis, in accordance with its guidelines. PPA may concentrate its investments in the aerospace and defense industry, as it seeks to track the performance of the Underlying Index, which includes companies important to the defense sector. Investors in PPA can expect dividend distributions based on the performance of these industry-leading companies, making it a potential choice for both capital appreciation and dividend returns.
Tracking the SPADE Defense Index is the primary objective of the Invesco Aerospace & Defense ETF (PPA). This ETF aims to mirror the performance of the index by investing at least 90% of its total assets in securities that constitute the Underlying Index. The SPADE Defense Index is composed of common stocks of U.S. companies involved in the defense sector, including those engaged in the development, manufacture, operation, and support of U.S. defense, military, national/homeland security, and government space operations. The ETF follows a modified market capitalization-weighted methodology and seeks to replicate the index by holding the same securities in proportion to their weightings in the Underlying Index. As of June 30, 2022, the Underlying Index comprised 55 constituents with market capitalizations ranging from approximately $241 million to $142.9 billion. The fund may concentrate its investments in specific industries to align with the index, and its holdings may evolve over time.
The Invesco Aerospace & Defense ETF (PPA) exhibits notable correlations with the aerospace and defense sector, given its investment focus. PPA is designed to track the SPADE Defense Index, composed of companies engaged in defense, military, national/homeland security, and government space operations. As a result, PPA's correlation with the defense industry tends to be strong, making it a valuable tool for investors seeking exposure to this sector. To gain deeper insights into PPA's correlations with specific defense companies and its performance compared to broader market benchmarks, investors can utilize ETF Insider's web app for comprehensive data visualization and analysis, helping them make informed investment decisions and identify potential areas of overlap in their portfolios.
The Invesco Aerospace & Defense ETF (PPA) primarily focuses on the aerospace and defense sector. This ETF invests at least 90% of its total assets in securities that make up the SPADE Aerospace & Defense Index. SPADE Indexes LLC compiles and maintains this index, which consists of common stocks of companies strategically important to the defense sector. These companies are involved in various aspects of defense, military, national/homeland security, and government space operations, including the development, manufacture, operation, and support of defense-related products and services such as military aircraft, naval vessels, armored vehicles, missiles, secure communications, intelligence, and reconnaissance systems. As of June 30, 2022, the index included 55 constituents with varying market capitalizations, and the ETF seeks to replicate the index's performance by investing in these securities in proportion to their weightings. PPA may have concentrated exposure to the aerospace and defense industry, which can provide investors with opportunities tied to this sector's growth and stability. However, it's important to note that concentration in a specific industry may carry higher risks.
The Invesco Aerospace & Defense ETF (PPA) is designed to provide exposure to the aerospace and defense sector of the U.S. equity market. It tracks the SPADE Defense Index, which includes companies engaged in the development, manufacture, operation, and support of U.S. defense, military, national/homeland security, and government space operations. PPA invests in common stocks of these systematically important defense sector companies, offering investors a way to participate in this critical industry. As of June 30, 2022, the ETF was comprised of 55 constituents, reflecting the market capitalizations of companies ranging from approximately $241 million to $142.9 billion. While this provides a concentrated exposure to the aerospace and defense sector, investors looking to gain insights into the specific holdings and correlations within the ETF can turn to the ETF Insider web app. This tool offers comprehensive data and visualization, helping investors understand the overlap, correlations, and other critical aspects of PPA''s holdings and performance. With the ability to explore deeper insights, investors can make more informed decisions about including PPA in their portfolios.
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