With War Increasingly Defined By Drones, SHLD Is An Interesting Buy

(10min)

Summary

  • Rising global defense spending and heightened geopolitical tensions make the defense sector attractive, with drones and drone defense emerging as key growth areas.
  • The Global X Defense Tech ETF offers diversified exposure to leading defense and drone technology companies across the U.S., Europe, and Asia.
  • SHLD's portfolio includes top holdings like BAE Systems, AeroVironment, and Lockheed Martin, providing balanced access to both established and innovative defense firms.
  • Given current market risks, SHLD stands out as a relatively safe option and a solid buy for investors seeking broad defense sector exposure.

Drone flying over a futuristic city

Buena Vista Images

The defense industry seems like a relatively safe place to be right now. The war in Ukraine, along with rising tensions elsewhere, has governments scrambling to build up military capacities to ward off threats. The defense industry is rather complex, and

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Markets rise and fall, booms come and go, and the world keeps ticking. Ultimately, I believe observing megatrends, as difficult as they can be to spot, let alone fully comprehend, can yield insights into the advance of human society, which in turn could pave the way for many useful investment insights. As society and technologies evolve, companies and other stakeholders will seize advantages. Figuring out which companies will take the best advantage of any given opportunities is not easy. I am especially interested in macrotrends, futurism, and increasingly, emerging technologies. However, as far as investing is concerned, it’s crucial to pay attention to the fundamentals, quality of leadership, product pipeline, and all the other details. In recent years, I have focused on marketing and business strategy, primarily for medium sized companies and startups. I have worked in international development, including overseas for a foreign Prime Minister’s office, as well as non-profit work in the United States. Among other tasks, I evaluated startups and emerging industries/technologies. I have also moonlighted as a technology and economic news journalist. Now I’m looking to tie everything together. While my personal interests will always keep megatrends and technological developments in mind, I do believe fundamentals and technicals are vital to uncovering opportunities.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Short position through short-selling of the stock, or purchase of put options or similar derivatives in SHLD over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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