SHLD ETF Review: What Global X's Defense Fund Holds
The SHLD ETF is a 50-stock defense-technology portfolio tracking the Global X Defense Tech Index with an expense ratio of 0.50%, led by Palantir Technologies at 11.98% of net assets as of October 1, 2026. It suits investors who want international defense contractors and software platforms rather than a pure drone basket. The five drone and counter-drone names we track there (Kratos, AeroVironment, DroneShield, Red Cat and Elsight) totaled 2.51% on that date.
Is SHLD Worth Buying? What the Fund Holds
The Global X Defense Tech ETF (SHLD) gives investors broad equity exposure to defense hardware, cybersecurity, and enterprise military software rather than concentrated drone manufacturing. What we see readers get wrong most often with SHLD is reading "defense tech" as "drones": its five largest positions on October 1, 2026 were Palantir and four U.S. defense contractors.
The portfolio held $6.47 billion in net assets across 50 holdings as of October 1, 2026. The 10 largest positions accounted for 64.59% of total net assets on that date. Palantir Technologies was the largest individual constituent at 11.98%, followed by four U.S. defense contractors: RTX Corporation, General Dynamics, Lockheed Martin and Northrop Grumman.
Whether SHLD fits depends on whether you want that concentration. The fund is not an early-stage robotics basket. It holds large defense contractors from the U.S., Europe and South Korea alongside Palantir's software business.
| Company | Ticker | Weight (% of Net Assets) | Primary Focus |
|---|---|---|---|
| Palantir Technologies | PLTR | 11.98% | Defense AI, data analytics, and operational software |
| RTX Corporation | RTX | 9.02% | Missile defense, radar systems, and aerospace hardware |
| General Dynamics | GD | 8.37% | Combat vehicles, naval vessels, and mission systems |
| Lockheed Martin | LMT | 8.17% | Fighter aircraft, hypersonics, and tactical missiles |
| Northrop Grumman | NOC | 7.49% | Bombers, space systems, and autonomous aircraft |
| BAE Systems | BA/ LN | 4.65% | European defense systems, munitions, and combat vehicles |
| Hanwha Aerospace | 012450 KS | 3.92% | Artillery, aerospace propulsion, and armored systems |
| L3Harris Technologies | LHX | 3.70% | C6ISR, tactical radios, and defense electronics |
| Saab AB | SAABB SS | 3.66% | Gripen fighter jets, submarines, and surveillance radar |
| Thales | HO FP | 3.63% | Air defense radar, optronics, and defense avionics |
How the Index Picks and Weights Stocks
The fund tracks the Global X Defense Tech Index, which is administered and calculated by Mirae Asset Global Indices Pvt. Ltd. and developed by Global X Management Company LLC. According to the SHLD Summary Prospectus dated April 1, 2026, an eligible company must earn at least 50% of its revenue, in aggregate, from three activities. The first is cybersecurity. The second is defense technology, such as artificial intelligence, big data, geospatial intelligence, intelligence, surveillance and reconnaissance (ISR), and command, control, communications, computers, cyber and combat systems (C6). The third is advanced military systems and hardware, which the prospectus says explicitly includes robotics and drones, along with military aircraft, naval ships and space launch systems.
Constituents must clear liquidity and size thresholds established at semi-annual reviews. Eligible securities require a minimum market capitalization of $200 million and a six-month average daily turnover of at least $2 million as of the index selection dates. The eligible universe spans exchanges in 44 countries, permitting broad multinational ownership that differentiates the fund from purely domestic indexes.
Weighting uses a modified free-float market capitalization model with a strict capping mechanism applied at each reconstitution. No individual security may exceed an 8% weight at the semi-annual rebalance. Palantir stood at 11.98% as of October 1, 2026, which demonstrates how constituent performance can cause individual weights to drift substantially higher between official rebalancing periods.
How Much Drone Exposure SHLD Has
The Global X fund page names "drone systems" among the sectors defense tech spans, but drone makers are a small part of SHLD. The drone label below is our classification, not Global X's. According to the SHLD full holdings CSV dated October 1, 2026, tactical target and unmanned system developer Kratos Defense & Security Solutions accounted for 1.26% of net assets, while loitering munition and reconnaissance specialist AeroVironment stood at 0.85%.
Smaller drone-related names carry even less weight. Counter-unmanned system manufacturer DroneShield represented 0.17% of net assets, small drone builder Red Cat Holdings accounted for 0.13%, and communication link provider Elsight stood at 0.10%. Karman Holdings, an aerospace components firm, held 0.47%, and subsea autonomous vehicle developer Kraken Robotics held 0.14%.
Kratos, AeroVironment, DroneShield, Red Cat and Elsight together came to 2.51% of net assets on October 1, 2026; adding Karman and Kraken brings it to 3.12%. RTX alone, at 9.02%, outweighed all seven.
What SHLD Costs and How It Pays Out
The fund charges a total annual operating expense ratio of 0.50%, as stated in its summary prospectus and on the Global X SHLD fund page. That is more than ITA's 0.37% or XAR's 0.35% gross expense ratio and less than PPA's 0.58%. SHLD launched on September 11, 2023. The fund held $6.47 billion in net assets across 107,420,000 shares outstanding as of October 1, 2026, with a net asset value (NAV) of $60.20 per share and a closing market price of $60.14.
The 30-day median bid-ask spread was 0.05% as of October 1, 2026. The fund issues income distributions semi-annually, registering a 30-day Securities and Exchange Commission (SEC) yield of 0.68% as of October 1, 2026.
Assets under management (AUM) fell between August 31 and October 1, 2026. The SHLD fact sheet dated August 31, 2026, listed net assets of $7,239.79 million across 50 holdings, indicating a net asset decline of more than $760 million by October 1, 2026.
Why SHLD Has Fallen
Global X's own figures show SHLD down over the past year. Issuer performance figures through September 30, 2026, show an average annualized one-year return of -13.45% at NAV, -13.88% based on market price, and -13.02% for the underlying index. Total assets fell from $7.24 billion on August 31, 2026, to $6.47 billion on October 1, 2026.
No source we could verify explains the decline. Global X's fund page and fact sheet report the numbers but give no cause, so this page does not assign one.
For scale, the decline followed a strong 2025: the summary prospectus shows a 74.55% return for calendar year 2025, and the fact sheet showed a 1.21% year-to-date gain as of August 31, 2026.
SHLD vs ITA and Other Defense ETFs
Three other defense ETFs make useful comparisons: ITA, XAR and PPA. The iShares U.S. Aerospace & Defense ETF (ITA) carries an expense ratio of 0.37% and holds 50 positions valued at $12.17 billion as of October 1, 2026. ITA weights holdings by float-adjusted market cap, tracking the Dow Jones U.S. Select Aerospace & Defense Index. GE Aerospace (20.89%) and RTX (16.07%) made up 36.96% of it on October 1, 2026.
Equal-weighted exposure presents another structural alternative. The State Street SPDR S&P Aerospace & Defense ETF (XAR) charges an expense ratio of 0.35% and tracks a modified equal-weighted index of 50 holdings totaling $5.54 billion in assets as of October 1, 2026. Because XAR spreads weight across large, mid and small companies, its top 10 made up only 30.20% of net assets on October 1, 2026. AeroVironment held 2.94% and Kratos 2.75%.
The Invesco Aerospace & Defense ETF (PPA) charges the most of the four: a net expense ratio of 0.58% across 67 holdings tracking the SPADE Defense Index, with $7.43 billion in assets as of October 1, 2026. ITA's holdings are all listed as U.S. companies, and XAR holds only U.S.-dollar listings. SHLD is different. As of August 31, 2026, 36.66% of its equity positions were outside the U.S., including BAE Systems, Hanwha Aerospace, Saab and Thales.
Who This Fund Fits and Who Should Avoid It
SHLD fits an investor who wants global defense exposure plus Palantir's software business. It also means accepting a large single-stock position in Palantir. About 36.66% of its equity positions sat outside the U.S. as of August 31, 2026, mainly in Britain, South Korea, Germany and France, which ITA's U.S.-only holdings do not reach.
The fund is not suited for investors seeking targeted exposure to tactical drone warfare or pure-play autonomous flight hardware. Those seeking pure robotics exposure should consult our best drone ETF framework, evaluate specialized products on our drone ETF list, or consider single-stock allocations using our drone ETF vs stocks guide. XAR, for example, held AeroVironment at 2.94% on October 1, 2026, against 0.85% in SHLD.
Our assessment of the fund would change if the underlying index revised its capping rules to prevent constituent drift above 8% between rebalances, or if the selection criteria introduced a dedicated sub-sleeve for pure-play autonomous systems.
What to Check Before Allocating Capital
Before buying SHLD, open the latest full holdings file from the Global X SHLD page and check whether any position, such as Palantir, has drifted above the 8% cap since the last rebalance.
If you already own defense stocks or an aerospace fund, compare SHLD's top 10 against them to spot overlap. You can benchmark this portfolio structure against general defense funds by reading our guide to the best defense ETF.
Check the latest regulatory filings on the Global X Summary Prospectus page to verify the current 0.50% operating fee and confirm that the fund's 80% non-fundamental asset allocation policy remains in effect.
ETF FAQ
Is shld a buy?
This page makes no buy or sell call. SHLD fits an investor who wants global defense-tech exposure led by Palantir (11.98%) and large defense contractors as of October 1, 2026. It does not fit someone who wants pure drone exposure: its drone and counter-drone names totaled 2.51% on that date.
What are the top 10 holdings of SHLD?
As of October 1, 2026, the top 10 holdings were Palantir Technologies (11.98%), RTX Corporation (9.02%), General Dynamics (8.37%), Lockheed Martin (8.17%), Northrop Grumman (7.49%), BAE Systems (4.65%), Hanwha Aerospace (3.92%), L3Harris Technologies (3.70%), Saab AB (3.66%), and Thales (3.63%). These 10 holdings accounted for 64.59% of net assets, with Rheinmetall tied with Thales at 3.63%.
Why is SHLD ETF tanking?
Global X's figures show a one-year return of -13.45% at net asset value (NAV) through September 30, 2026, and net assets falling from $7.24 billion on August 31, 2026, to $6.47 billion on October 1, 2026. Global X gives no explanation for the decline, and no source we could verify names a cause.
Is there an ETF for war stocks?
Several exchange-traded funds invest in aerospace, defense contractors, and military equipment providers. Prominent options include SHLD for global defense technology, ITA for market-cap-weighted United States defense primes, XAR for equal-weighted aerospace exposure, and PPA for broad national security and defense systems.