Airline ETF List: Trade Aviation sector through Airline ETF Exchange Traded Funds: Options, Futures, Derivatives & Commodity Trading

Airline ETF List: Trade Aviation sector through Airline ETF Exchange Traded Funds

This article covers the list of available ETF in Airline sector or Aviation ETF or Exchange Traded Funds. Investors who are keen on trading and investing in airline stocks through the ETF mode can consider these airline ETF for trading and investments.
Are you bullish (or bearish) on the aviation sector? Do you believe that airline stocks will give good returns in long run or short term? Do you want to trade or invest in airline stocks, but are worried about taking risk of investing only in a single airline stock and are looking for a better diversified product like a fund focussed on airline or aviation sector? Then here you will find the answers. Below we discuss some of the available Airline ETF or Exchange Traded Funds, which provides exposure to airline sector and through these funds you can trade in short term or invest in long term in the airline sector, without taking the individual stock specific risk.

Airline ETF List: List of Aviation ETF Exchange Traded Funds

There are couple of airline sector specific funds available in the market.

Guggenheim Airline ETF (NYSE:FAA) :
Please note that this fund was earlier known as "Claymore/NYSE Arca Airline ETF". Now it is known as Guggenheim Airline ETF. Airline ETF
This fund being an ETF tracks an underlying index called the NYSE Arca Global Airline Index. This ETF follows a low cost passive investment approach to seek returns which track the underlying index, (after reducing fees and expenses). Most of the constituents include top airline company stocks, their ADR and GDR.
It has international exposure as many international airline stocks are included in the index - however primary weightage, around 67% is still with USA companies. Rest is split across the globe from japan to AUstralia to Germany, UK, etc.
Expense Ratio of Guggenheim Airline ETF is 0.65%.

PowerShares Aerospace & Defense ETF: NYSE:PPA:
PowerShares Aerospace & Defense ETF comes from Invesco Powershares.
It tracks the underlying SPADE Defense Index . As the name suggests, apart from commercial airline companies, this ETF and the underlying index also includes defense companies in aviation sector. The constituents include wide variety of companies which derive their profits from the business of development, manufacturing, operations and support of the US defense, homeland security and aerospace operations.
So this ETF is purely US specific, but provide exposure to non-commercial aviation sector too.

Why should I invest in the airline ETF or aviation sector?
Recent reports are that airline specific ETF's are touching new highs everyday.
The reason - airlines are making good profits. The recent numbers about the air traffic post a healthy picture - airlines are expected to have good business in coming era.

What are the risks of airline ETF or aviation sector?
Nothing is free of risk.
Airlines sector, the stocks as well as the ETF, may get hit by the rising fuel prices, especially with the current unrest in the oil countries. Interest rates might hit the profits, and if economy does not do as expected, the high flying air traffic might come to a standstill, causing a loss of investments in airline sector. Hence, take the call as per your risk appetite
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