You can still get Rocket Lab’s returns, but with the added bonus of diversification.
Recently, one of the standout performers in the stock market has been Rocket Lab (RKLB +1.14%). With its array of services including launch protocols, rockets, space vehicles, and satellite technologies, Rocket Lab is establishing itself as a formidable player in both U.S. and international space initiatives. In fact, Rocket Lab stock surged an incredible 360% in 2024 and 174% in 2025, making a $10,000 investment three years ago worth around $186,880 today—transformative financial gains for many investors.
It’s no surprise that investors eye Rocket Lab if they’re interested in space stocks. However, while this stock looks promising, there’s a compelling alternative that offers greater benefits—enter the Defiance Drone and Modern Warfare ETF (JEDI +0.92%). This ETF not only includes Rocket Lab as a key component but also provides exposure to various other intriguing companies within related sectors.
Image source: Getty Images.
What is the JEDI ETF?
The Defiance Drone and Modern Warfare ETF is managed by Defiance ETFs, an organization focusing on thematic exchange-traded funds. Unlike traditional ETFs that track standard indices like the S&P 500, the JEDI ETF is categorized as a thematic ETF, concentrating on a specific industry or concept.
This ETF showcases companies involved in military drones, AI-driven warfare, defense technology, and space products, including military robotics and cybersecurity solutions. To ensure a balanced approach, no single stock can exceed a 10% weight within the index, effectively mitigating concentration risk. Currently, the JEDI ETF holds 26 distinct stocks, with Rocket Lab occupying the top position. Notably, the top 10 stocks together comprise 64% of the ETF’s total weight.
|
Rank/Company |
ETF Weight |
One-Year Performance |
|---|---|---|
|
1. Rocket Lab |
8.66% |
180.8% |
|
2. Kratos Defense & Security Solutions |
7.29% |
242.4% |
|
3. L3harris Technologies |
6.83% |
56.1% |
|
4. RTX |
6.73% |
57.1% |
|
5. Saab AB |
6.45% |
282% |
|
6. Thales SA |
6.06% |
94.7% |
|
7. Palantir Technologies |
5.79% |
126.3% |
|
8. Elbit Systems |
5.78% |
131.8% |
|
9. AeroVironment |
5.53% |
80.1% |
|
10. Leidos |
5.39% |
20.1% |
Data source: Defiance ETFs
Interestingly, Rocket Lab is not even the best-performing stock within the JEDI ETF; that accolade belongs to Saab AB, a Swedish defense firm noted for producing fighter jets and providing cybersecurity solutions for military operations. Kratos Defense, specializing in high-performance drones and satellite communications targeted for space applications, has also outpaced Rocket Lab.
ETF Series Solutions – Defiance Drone And Modern Warfare ETF
Today’s Change
(0.92%) $0.27
Current Price
$29.48
Key Data Points
Day’s Range
$29.16 – $29.66
52wk Range
$21.91 – $30.45
Volume
45K
Palantir is likely the most recognizable name among the ETF’s top holdings. This data analytics firm specializes in software that leverages satellite data and numerous other data streams to deliver actionable insights for military and intelligence agencies. Their Artificial Intelligence Platform (AIP) and Foundry platform for commercial use are gaining traction rapidly.
How does Rocket Lab fit in the JEDI ETF?
While companies in the JEDI ETF display a more pronounced military focus, Rocket Lab contributes significantly through its 21 successful launches in 2025. Its clientele spans notable names including the U.S. Space Force and Japan’s national space agency, alongside others that remain undisclosed.
Rocket Lab’s involvement is multifaceted, extending to NASA’s Escapade mission to Mars, which launched on November 13. The company provided the spacecraft transported by Blue Origin rockets, focusing on solar wind effects on Mars’ atmosphere.
On the military side, Rocket Lab has recently secured an $816 million contract from the U.S. Space Development Agency to develop missile-tracking satellites. Moreover, they are working on a $515 million project to create a satellite communications network directed at military applications. Comparatively, Rocket Lab is anticipated to bid on the Department of Defense’s Golden Dome project, aiming to utilize ground-based and space-based missiles for interception.
Today’s Change
(1.14%) $1.00
Current Price
$88.98
Key Data Points
Market Cap
$47B
Day’s Range
$86.12 – $94.41
52wk Range
$14.71 – $99.58
Volume
565K
Avg Vol
23M
Gross Margin
28.93%
Former President Donald Trump has proposed increasing the U.S. defense budget from $900 billion in 2026 to $1.5 trillion in 2027, a policy shift that is likely to bolster profits for Rocket Lab and its peers within the JEDI ETF.
While the allure of high-growth stocks such as Rocket Lab is undeniable, diversifying into ETFs like the Defiance Drone and Modern Warfare ETF can be a smarter approach. Launched in September 2025, this ETF serves as an excellent option for investors with an eye on Rocket Lab, offering a well-rounded portfolio, albeit with a slightly elevated expense ratio of 0.69%. The fee translates to $69 per $10,000 annually: a price many would find justifiable given the potential returns.