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StocksMedium•20 February 2026•

1 min read

Defense ETFs Gain Momentum Amid Rising Geopolitical Tensions in 2026

Fortified uniQure building, fences, caution tape, security cameras. FDA buildings, US flags, justice symbols. Charts on tablets and papers.

Global markets are witnessing a significant surge in geopolitical risks in 2026, prompting investors to seek strategic opportunities within the security sector. The year commenced with a U.S. military operation in Venezuela, while the Russia-Ukraine conflict entered its fifth consecutive year. These escalating regional instabilities have triggered a heightened interest in exchange-traded funds (ETFs) focused on the aerospace and defense sectors. Analysts anticipate that prolonged military conflicts will drive substantial increases in government defense budgets worldwide, benefiting defense contractors. Major defense-themed funds, including ITA, XAR, and PPA, are expected to outperform as demand for advanced defense technologies rises. This complex geopolitical landscape underscores a bullish outlook for the defense sector throughout the current year.