What this ETF is trying to do

The FIRST TRUST INDXX AEROSPACE & DEFENSE ETF (ticker: MISL) is an exchange-traded fund designed to provide exposure to the aerospace and defense industry. It holds a variety of companies involved in these sectors, such as those making aircraft, space technology, and defense systems.

What the numbers show

As of October 9, 2026, the current price of MISL is $42.24. Looking at historical performance, we can see different trends depending on the time frame:

• Year-to-Date (YTD): The price return is approximately -1.29%, while the total return is approximately -1.22%.

• One-Year: The price return was approximately -2.43%, and the total return was approximately -2.36%.

• Three-Year: This period shows significant growth, with a price return of approximately 86.49% and a total return of approximately 89.62%.

An estimated price from roughly one year ago was $43.29. It is important to note that "price return" only tracks the change in the share price, while "total return" includes the impact of distributions.

Income and distribution explanation

MISL provides a distribution yield of approximately 6.77%. The trailing distributions were $0.0286. The distribution frequency is described as "irregular" or "less frequent," with only one payout recorded in the last 12 months. Because the payouts do not happen on a regular schedule, investors should not rely on them as a steady stream of monthly income.

NAV erosion explanation

The supplied data is sufficient to evaluate price erosion, but it does not include enough historical NAV-per-share data to confirm or rule out NAV erosion.

However, we can look at the "erosion-risk score," which is 94. This is labeled as "Stable / sideways" with a "good" severity level. This score is a measurement of price-based risk, not a direct proof that the fund's Net Asset Value (NAV) has declined.

Top Holdings

The following are the top holdings in the fund (note that this list is partial):

• Palantir Technologies Inc: 10.33%

• RTX Corp: 8.56%

• Boeing Co: 7.86%

• GE Aerospace: 7.67%

• Space Exploration Technologies Corp Class A: 6.87%

• Lockheed Martin Corp: 4.28%

• Northrop Grumman Corp: 4.00%

• Heico Corp: 3.92%

• General Dynamics Corp: 3.91%

• Howmet Aerospace Inc: 3.89%

Holdings can change over time.

Pros

• Strong Long-Term Growth: The three-year total return shows significant historical growth.

• Stable Risk Score: The erosion-risk score suggests the price trend has been relatively stable or sideways rather than rapidly declining.

Cons

• Recent Price Declines: Both the year-to-date and one-year price returns have been negative.

• Irregular Income: The distributions are not frequent, which may make it difficult for income-focused investors to plan.

Beginner takeaway

MISL focuses on the aerospace and defense sector. While it has shown very strong growth over a three-year period, its recent one-year performance has seen a slight share-price decline. It offers a distribution yield, but because the payments are irregular, it may not function like a steady income tool.