Time to Buy Wide Moat & HALO ETFs?
Wall Street is caught in the midst of shifting geopolitical stances of the United States and Iran, chances of higher global inflation, weak U.S. jobs data, the possibility of stagflation in the U.S. economy, and the Fed’s likely dilemma in fixing the monetary policy amid a weakening labor market and accelerating inflation. Also, the occasional selloffs in the red-hot artificial intelligence (AI) space have been a steady concern.
Inside Geopolitical Threats
Geopolitical tensions escalated this week after Kuwait accused Iran of launching fresh missile and drone attacks, a day after the United States carried out retaliatory strikes on more than 80 Iranian military targets, including air defense systems, command centers, anti-ship missile sites and Islamic Revolutionary Guard Corps boats.
The United States said the operation was in response to Iran's attacks on three commercial vessels transiting the Strait of Hormuz, calling them a violation of the June ceasefire. Kuwait reported intercepting incoming missiles and drones.
The renewed hostilities have put the fragile ceasefire under severe strain. Iran accused Washington of breaching the agreement, and the United States defended its actions as necessary to safeguard international shipping.
President Donald Trump also declared that the ceasefire with Iran was over and signaled that the United States would reimpose its naval blockade in the Strait of Hormuz, according to CNBC.
Occasional Selloffs in the AI Space
Heightened AI skepticism in various parts of the globe, along with rising AI concentration in key U.S. equity gauges, is bothering investors. AI payoffs are yet to be realized on a full scale, while investments are growing insanely. Companies are tapping debt markets as well. So, investors are dumping AI stocks occasionally amid their exorbitant valuations.
Should You Buy Wide Moat ETFs?
Against the abovementioned uncertain investing backdrop, safer investment options appear lucrative. Investors are not bearish on U.S. equities thoroughly. Many still plan to hold stocks but are adjusting their high expectations after a strong decade.
Many may be interested in playing quality stocks and exchange-traded funds (ETFs), for example, wide-moat stocks and ETFs.
In the world of investing, "moat stocks" refer to companies that possess strong competitive advantages. The term was popularized by legendary investor Warren Buffett, who said that he seeks "economic castles protected by unbreachable moats.”
Over the past five years, VanEck Morningstar Wide Moat ETF MOAT has been up 40% compared with 71% gains in the S&P 500 (as of July 8, 2026). Although MOAT ETF has underperformed the S&P 500 in most cases, high moat stocks and ETFs give investors peace during times of uncertainty. Over the past month, MOAT has added more than 2% while the S&P 500 ETF SPY has advanced 1.1%. Over the past week, MOAT has topped SPY marginally.
It means that if the mastery of the “Magnificent 7” stocks in the S&P 500 wanes at some point in time and the index starts to lose its luster, quality ETFs like MOAT may rule and save your portfolio in difficult times.
Tap HALO ETF: Here’s Why
Heavy Asset, Low Obsolescence (HALO) stocks are exclusively positioned to survive the constant threat of AI disruption. “HALO stocks are companies built on tangible, hard-to-replicate physical infrastructure and entrenched operating footprints, making their economic moats inherently resistant to breakthroughs in artificial intelligence,” per Roundhill Investments.
LOHA HALO ETF LOHA is built on this concept. LOHA seeks to track the performance of the Akros U.S. Heavy Assets Low Obsolescence (HALO) Index.Cash flows are backed by essential demand, regulated frameworks, or long-term contracts.
The fund is insulated from AI-driven disruption, with physical assets and essential services that large language models or agentic AI cannot easily dislocate. No stock accounts for more than 1.17% of the fund. Industrials (37.46%), Materials (15.96%) and Consumer Staples (15.85%) are the top three sectors of the fund.
According to Goldman Sachs Group Inc. strategists, capital-intensive companies have significantly outperformed peers that are more reliant on human or digital assets. "Going forward, we expect returns to be increasingly driven by earnings," per a Business Insider article, as quoted on Yahoo Finance.
“Investors remain under-positioned for a world in which physical assets, infrastructure and industrial capacity regain strategic importance,” the team, including Guillaume Jaisson, said, referring to a group classified as “HALO,” the same source mentioned.
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State Street SPDR S&P 500 ETF Trust (SPY): ETF Research Reports
VanEck Morningstar Wide Moat ETF (MOAT): ETF Research Reports
Roundhill HALO ETF (LOHA): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).
Source Zacks-com
