3 Funds for the HALO Trade

Russel Kinnel: Today, I’m on a HALO quest. As AI coding has made a big leap, software stocks and just about anything else that might be replaced by AI have been smoked. But as Josh Brown points out, heavy asset, low obsolescence aka “HALO” stocks, ought to be safe from Claude and his friends.

So I set out to do some HALO maxing. I screened for Medalist funds with heavy industrial stakes and not much in tech. Here are three ideas for those of you with a software-laden portfolio.

3 Funds for the HALO Trade

1. Lazard Global Listed Infrastructure Open GLFOX
2. FMI Common Stock Investor FMIMX
3. Royce Premier Invmt RYPRX

Lazard Global Listed Infrastructure has 30% in industrials and nothing in technology. As the name suggests, it invests in railroads, utilities, toll roads, and airports. Disrupt that, AI. The fund is heavily tilted toward Europe and pretty well removed from tech stock performance.

FMI Common Stock has 40% in industrials and just 14% in tech. The fund runs a focused small- and mid-cap portfolio with an emphasis on modest valuations and strong returns on equity.

Small-cap Royce Premier has 35% in industrials and 17% in technology. The fund is chock-full of boring asset-heavy companies that make things like chemicals, air conditioners, and railroad ties. The fund focuses on companies with clean balance sheets, competitive advantages, and modest valuations.

Watch 3 Great Portfolio Diversifiers and 3 to Avoid for more from Russel Kinnel.