Roundhill launches LOHA ETF focusing on heavy asset companies

Roundhill's new Roundhill Heavy Assets and Low Obsolescence ETF (LOHA) launched in May 2026, targeting an investment strategy that counters the current trend of software and artificial intelligence-heavy portfolios. The ETF focuses on companies with substantial physical infrastructure and long-lived capital assets, aiming to provide investors a diversified alternative to tech-heavy indices. This approach is rooted in the belief that firms dependent on physical resources are less vulnerable to disruption from new tech startups.

The LOHA fund, conceptualized by Josh Brown of Ritholtz Wealth Management, includes 100 U.S. companies that are equally weighted and rebalanced quarterly. Its largest holdings include Cummins, AutoZone, and Lennox International. Cummins reported record Power Systems sales of $2.3 billion in Q2, a 19% increase, driven by the demand for backup diesel generators from AI data centers. This highlights a paradox: even as the fund is positioned as an "anti-AI" investment, many of its key companies are benefiting from the growth of AI infrastructure.

The companies in LOHA's portfolio represent essential services and products that rely on extensive physical assets. For example, AutoZone operates the largest auto parts network in the U.S., while Lennox manufactures heating and cooling systems. This contrasts sharply with software firms, where value can often be replicated quickly with new coding. The fund’s strategy reflects a belief that industries with significant operational scale and entrenched distribution networks are better positioned for long-term stability.

As more investors seek alternatives to traditional tech-focused funds, LOHA's approach could resonate in today’s market. The ETF offers a unitary fee structure with a 0.35% expense ratio, making it accessible for those wary of high costs associated with other investment vehicles. The success of LOHA will be measured by its ability to attract investors looking for a balanced portfolio that emphasizes the physical economy, even as AI continues to reshape multiple industries.