NEW YORK (CNN/Money) - The war with Iraq would seem to be a big boost for defense technology stocks, but that might not be the case. It hasn't been so far.

Investors have been fretting about the near-term outlook for technology stocks for some time, defense stocks included. Indeed, the Philadelphia Defense Index, a collection of 17 defense stocks, is down 13 percent year-to-date as of March 17. The index has plunged 27 percent during the past twelve months.

Bob Straus, manager of the Icon Information Technology fund, says he sold off stakes in several defense companies in November because of their weak performance. Many defense stocks had run up earlier last year on expectations of increased military spending for anti-terrorism programs and in anticipation of a war with Iraq. As such, valuations for the sector got pretty rich rather quickly.

Straus says investors might be able to make some money from quick trades in the sector but doesn't recommend this strategy since it is so risky. He says the only two he would recommend in the near term are radar and missile manufacturer Raytheon (RTN: Research, Estimates) and Dow component United Technologies (UTX: Research, Estimates), because of their steady earnings growth and attractive valuations.

Abel Garcia, co-manager of the AIM Global Science and Technology fund, also thinks that investors could make money in the initial days of the war but that they would need to act fast. He says that during the last Gulf War in 1991, defense stocks spiked upwards when the war first started but then sold off dramatically as investors began to fear that the gains were unsustainable.

Longer term however, defense stocks should benefit, even if the war is quick, says Dan Ahrens, co-manager of the Vice Fund, a mutual fund that invests in defense, alcohol, gaming and tobacco stocks.

Ahrens says that regardless of what ultimately happens in Iraq, defense spending will likely continue to increase over the next few years, particularly on programs involving surveillance, reconnaissance and other anti-terrorism measures.

Ahrens owns shares of L-3 Communications (LLL: Research, Estimates), which makes electronic components for the defense industry, Northrop Grumman (NOC: Research, Estimates), the defense contractor that acquired military space technology company TRW last year, Lockheed Martin (LMT: Research, Estimates), and aviation technology companies Rockwell Collins (COL: Research, Estimates) and Esterline Technologies (ESL: Research, Estimates).

Garcia agrees that defense technology companies will probably be more dependable over the next few years because the government still needs to further modernize the military and will spend to do so despite what's happening with the broader economy. His fund owns shares of L-3, Northrop and Alliant Techsystems (ATK: Research, Estimates), which makes ammunition and rocket propulsion systems.

"The market may pay higher earnings multiples for defense companies because they should show earnings while other technology companies won't," Garcia says.