WDAF vs XAR

WDAFCWisdomTree Asia Defense Fund

XARAState Street SPDR S&P Aerospace & Defense ETF

In short

WDAF Most defense ETFs are a story about the US primes. WDAF flips the map: a rules-based basket of Asia-Pacific defense names, weighted toward the companies that earn the biggest share of their revenue from defense.

XAR Most defense funds hand the wheel to a handful of giant primes. XAR spreads its roughly 50 aerospace and defense names close to equal weight, so a mid cap parts maker carries about the same load as a household-name contractor.

Stated mandate

WDAF The Fund seeks to follow the pre-fee price and yield performance of the WisdomTree Asia Defense Index. It uses passive indexing with representative sampling and normally invests at least 80% of net assets in index constituents or economically similar investments.

XAR The fund seeks to track, before fees and expenses, the total return performance of the S&P Aerospace & Defense Select Industry Index.

Why people hold it

• WDAF Pure-play Indo-Pacific defense: Japan, South Korea, India, Taiwan, Australia and neighbors. The best-known funds in its peer group lean US (XAR, ITA) or transatlantic (NATO).wisdomtree.com
• 0.45% a year, below the median fee for defense-theme ETFs.
• Weighting is not just size. Each name's market cap is scaled by how much revenue comes from defense, then capped at 7.5% for the purest plays and 4% for everyone else.wisdomtree.com
• Clear rules: at least 10% defense revenue, $200M free float and $1M average daily volume to qualify, with the roster rebuilt each March and September.wisdomtree.comsec.gov

• XAR Modified equal weighting keeps any single prime contractor from running the show: large, mid and small cap names carry similar weight in the index.ssga.com
• Costs 0.35% a year, under the 0.50% typical of defense funds and a hair below ITA at 0.37%. Cheap for a targeted industry bet.
• Trading since 2011 and now a multi-billion-dollar fund, it is one of the most established and best-built ways to own the US aerospace and defense industry.
• About 50 US-listed aerospace and defense stocks pulled from the S&P Total Market Index, so suppliers and smaller specialists sit alongside the famous names.ssga.com

Worth knowing

• WDAF Launched in 2025 and still small, so it trades thinly next to the long-established US defense funds and bid-ask spreads can be wider.
• If fewer than 20 companies clear the screen, the index loosens the revenue bar in 1% steps down to a 5% floor, so some holdings can be light on actual defense work.wisdomtree.com
• One sector, one region. WisdomTree notes that sector-focused funds are more exposed to any single economic or regulatory development, and the index holds as few as 20 names.wisdomtree.comsec.gov

• XAR One industry, tied to government budgets and order cycles. Expect bigger swings than a broad market fund.
• Equal weighting leans on smaller suppliers, which cuts both ways: less of the fund rides the megacap primes when those lead.ssga.com
• Distributions land quarterly, but this is an industry growth basket, not an income vehicle.

Full WDAF profile⁠

Full XAR profile⁠