3 Defense Stocks to Sell Before You Regret It | Markets

Selling defense stocks at a time when the wider market is showing strong growth may seem counterintuitive to investors. However, with more uncertainty set to reign in the months ahead, it now is a good time to trim.

In recent years, defense stocks have rallied throughout Wall Street. VanEck’s Defense ETF has grown 36.54% in the past 12 months, far outpacing the S&P 500.

Plus, with the prospect of a United States presidential election in November, the new incumbent could oversee dramatic changes. For instance, changes over the political landscape surrounding the conflicts in Europe and the Middle East.

Despite their outperformance, defense stocks don’t necessarily rally during periods of conflict. Evidence from Russia’s invasion of Ukraine in 2022 shows that affected stocks experienced significant outperformance before the conflict began. Relative returns fell largely flat for the following nine months in line with a wider bear market.

Uncertainty could arise from the U.S. presidential election, with both candidates discussing at length their proposals for peace talks. We could see the defense market struggle to maintain its momentum in the future. These three stocks are at risk:

Boeing (BA)

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