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www.HomelandDefenseStocks.com Presents Defense Stocks Commentary from Scott Sacknoff, Manager of the SPADE® Defense Index

Category: Investment, Defense

POINT ROBERTS, Wash., DELTA, B.C. - December 7, 2009 – www.HomelandDefenseStocks.com (HDS), a leading global investor and industry portal for the defense and security sector, within Investorideas.com, provides interested defense stocks investors with sector commentary from Scott Sacknoff, manager of the SPADE® Defense Index.

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Defense Commentary

Scott Sacknoff, manager of the SPADE® Defense Index

Long-time investors note that all investing is cyclical. Whether companies, sectors, themes, styles, or regions, when buyers outnumber sellers, prices rise and vice versa. Aerospace & Defense has been out of favor for the past year, but the perception is being to change. The sector has been held in check due to negative news from individual companies, the belief that the end of the Iraq conflict will flatten defense budget growth of the past decade, and the cancellation of major defense programs by the Obama administration -- yet investors in the sector have been rewarded with Nearly 20% gains year-to-date.

Recent news and analyst comments seem to indicate that the sector is regaining the favor of those that try to identify these cycles. The SPADE Defense Index, as well as the Powershares Aerospace & Defense ETF (NYSE: PPA) that tracks the index, was up nearly 6% in November and continues to outperform in December. Here are five reasons why:

  1. Obama's speech announcing the administration's plans for Afghanistan and the knowledge that spending here and in Iraq will be around for at least 2 to 3 more years.
  2. Boeing's anticipated flight in late December of its new 787 aircraft after numerous delays indicates that a rise in companies exposed to commercial aerospace is likely as companies increase manufacturing activity and book sales revenues from that held as backlog.
  3. Calls for additional $50 billion in supplemental spending by military officials to pay for the overseas efforts as well as a discussion by members of Congress to institute a "war tax" on wealthy Americans as has been done in previous periods of conflict.
  4. An improving U.S. economy which will take pressure off future budgets and debt servicing.
  5. Quarterly reports from several companies indicating growth in 2010 is likely and that expanded diversification efforts will enable them to attract contracts from other government markets. Combined with analyst comments regarding healthy balance sheets and available cash to position themselves, and the impact of flat defense spending will have less of an impact that originally feared.

Of course a number of market and political forces can impact things, but the rising volume of positive comments from analysts and the media seems to indicate a near-term bounce for the aerospace and defense sector.

Scott Sacknoff, manager of the SPADE® Defense Index

More info and previous interviews:
http://www.homelanddefensestocks.com/Content_Partners/SI/Default.asp

About the SPADE Defense Index

The SPADE Defense Index® (AMEX: DXS) is a modified capitalization-weighted index comprised of publicly traded companies that benchmarks the performance of companies involved with the defense, homeland security, and space marketplace.

The SPADE Defense Index has been developed to be used by investors, financial professionals, trade analysts, and media as a benchmark for publicly traded stocks involved in these business sectors. The Index can be used as the basis for a range of financial instruments including options and other derivatives, exchange traded funds, and conventional mutual funds.

For more information: http://www.spadeindex.com

Disclaimers: The information presented in this interview is for informational purposes and should not represent a solicitation or an offer to purchase an investment product. SPADE and the SPADE Defense Index are registered trademarks of the ISBC.

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Dawn Van Zant 800.665.0411
Email: dvanzant@HomelandDefenseStocks.com

Source: HomelandDefenseStocks.com, Investor Ideas

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