The Anti-AI ETF Is Here, and Its Biggest Holdings Are Engines, Trucks and Air Conditioners
August 15, 20263 Mins read77
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Cummins (CMI) posted record Q2 Power Systems sales of $2.3 billion, up 19%, by selling backup diesel generators directly to AI data centers.
AutoZone (AZO) and Lennox (LII) anchor LOHA’s physical-moat thesis, though Lennox’s residential revenues fell 30% as high mortgage rates squeezed demand.
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Roundhill’s Roundhill Heavy Assets and Low Obsolescence ETF (NYSEARCA:LOHA) launched in May 2026 as a counterweight to the software and AI concentration dominating most passive equity portfolios. The idea belongs to Josh Brown of Ritholtz Wealth Management, who coined the acronym HALO for heavy assets and low obsolescence to describe companies whose value sits in physical infrastructure, entrenched distribution, and long-lived capital rather than in code that a competitor can rewrite. LOHA translates that idea into an index of 100 US companies, equally weighted and rebalanced quarterly, with a 0.35% expense ratio and a unitary fee structure under which Roundhill absorbs most operating expenses.
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The top holdings make the pitch clear. Cummins (NYSE:CMI) builds diesel and natural gas engines, AutoZone (NYSE:AZO) runs the largest aftermarket auto parts network in the country, TFI International (NYSE:TFII) hauls freight, Lennox International makes furnaces and rooftop HVAC units, and Newmont digs gold out of the ground. If AI-heavy indices own the software layer, LOHA owns what sits under, around, and behind it.
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The Thesis Behind Heavy Assets
The argument runs like this: a company whose competitive position depends on physical scale (mines, factories, distribution centers, truck fleets, refrigerated warehouses, a national franchise footprint) cannot be disintermediated by a well-funded startup with GPUs. Replicating AutoZone’s roughly 20% operating margin requires actually building thousands of stores stocked with the right SKUs within a short drive of a mechanic who needs a part today. Replicating Cummins’ multi-year hyperscaler agreement, which secures several gigawatts of future backup power genset demand, requires foundries, engineering depth, and permits that a model checkpoint cannot provide.
The irony is that the physical economy is now partly a levered play on the AI buildout itself. Cummins’ Power Systems segment posted record Q2 sales of $2.3 billion, up 19%, as data centers need standby diesel generators. So the anti-AI fund’s flagship holding sells picks and shovels into the very trend the fund is marketed against, which is either a feature or a philosophical problem depending on how strictly you read the label.
Testing Whether Physical Really Protects
Heavy assets are not a free hedge. They are capital-intensive, cyclical, and often commodity-linked. Lennox told investors in July that “elevated mortgage rates, inflationary pressures, and historically low consumer confidence are constraining underlying demand,” and that residential new construction revenues declined by approximately 30%. Newmont’s margins swing with a gold price that carried a realized price of $4,414 per ounce in Q2 and could just as easily reverse. What LOHA holders are buying is exposure to the operating leverage of physical capacity, which cuts both ways.
Equal weighting at quarterly intervals caps the portfolio’s dependence on any single winner, tilts toward smaller industrials and materials names, and forces the fund to trim what has run and add to what has lagged. That mechanical rebalance is the opposite of how cap-weighted tech indices behave, and it is the structural reason the portfolio behaves like a counterweight rather than a proxy.
Does This Fit Your Portfolio?
LOHA is a thesis to evaluate rather than an established track record. With roughly $50 million in assets and only a few months of history, the fund carries new-fund liquidity risk and no meaningful data on how the strategy behaves across a full cycle. Anyone treating it as a proven diversifier is projecting.
The reasonable use case is a 3% to 7% sleeve for an investor whose broad-market exposure has drifted into heavy overlap with the Nasdaq-100, where the S&P 500 and QQQ (NASDAQ:QQQ) share the same handful of names at the top. For that investor, owning engines, trucks, HVAC, and gold miners in equal measure is genuine diversification at the business-model level rather than at the sector label. Investors expecting LOHA to outperform in a continued AI-led tape are likely to be disappointed, because the fund is designed to hold value when leadership shifts rather than to lead the shift itself.
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