Look, I know what you’re thinking. “Defense stocks? Really? That’s your hot tip?” But hear me out – while everyone’s obsessing over AI and crypto, there’s a guy at Global X ETFs managing $60 billion who thinks the real money is in things that go boom.
Scott Helfstein isn’t your typical Wall Street suit spouting buzzwords. He’s looking at the world map like a chess board and seeing some pretty obvious moves. With geopolitical tensions higher than your uncle’s blood pressure at Thanksgiving dinner, defense spending is about to get a serious boost.
“We’re moving to a world of decentralized deterrence,” Helfstein says, which is fancy talk for “everyone’s buying bigger sticks because the neighborhood’s getting sketchy.”
Here are his five picks that could make your portfolio more explosive than a Michael Bay movie:
1. Huntington Ingalls Industries (HII) – The Boat People
These folks build ships for the Navy, and they’re up 85% this year. Helfstein thinks we’re about to see autonomous ships become the new drones. Imagine a robot navy – it’s like Battleship, but the ships play themselves.
2. BAE Systems (BAESY) – The British Are Coming
This UK defense giant is up 64% and trading at 19 times forward earnings with a 4% free cash flow yield. Translation: it’s not stupidly expensive and actually makes money. Novel concept, right?
3. Rheinmetall (RNMBY) – German Engineering Meets Boom
Up 190% this year (yes, you read that right), this German company makes things that go fast and explode on target. As Europe gets more independent from US military support, someone’s got to supply the hardware.
4. Lockheed Martin (LMT) – The OG Defense Stock
Flat for the year, which in this market makes it practically a value play. It’s like buying Apple in 2008 – everyone knows it’s good, but the price got weird for a minute.
5. BWX Technologies (BWXT) – Nuclear Everything
Up 57% and playing both sides of the nuclear game – military submarines and civilian power plants. It’s like investing in both Batman’s gadgets and clean energy. Win-win.
The thesis is simple: the world’s getting spicier, defense budgets are growing, and these companies make the stuff governments need when things get complicated. Plus, unlike that crypto your cousin keeps pushing, these companies actually make real things that do real jobs.
Is it morally complex? Sure. But your portfolio doesn’t have feelings, and neither does inflation. Sometimes the best investments are the ones nobody wants to talk about at dinner parties.
Just remember – past performance doesn’t guarantee future results, geopolitics is unpredictable, and I’m not your financial advisor. But if you’re looking for sectors that might benefit from an increasingly chaotic world, well… here’s your shopping list.