HALO'd Out: Goldman Goes Short One Of Wall Street's Favorite Trades

It was just one month ago when Goldman, JPMorgan and virtually every other bank - scrambling for cover from the collapse in SaaS stocks resulting from AI disruption - were aggressively pitching the brand new HALO (High Assets, Low Obsolescence) concept to investors.

"A Shoot First, Think Later" Market, As Both Goldman & JPM See Feverish Rotation Out Of Digital Into Physical World https://t.co/JII2tueAts

— zerohedge (@zerohedge) February 13, 2026

One month later, the HALOmoon honeymoon is over, and in a note published overnight by Goldman's thematic trading team led by Faris Mourad, the bank writes that it likes going short US Companies that HALO’d too far (BBG ticker GSXUHALT).

According to Mourad, the basket provides exposure to asset-heavy businesses with low returns and no growth that have rallied too far based solely on their assets and more defensive positioning (so not the full set of HALO names).

The bank filters for Russell 1000 companies in industries with the highest asset intensity ratios and excludes all stocks that are tied to any secular trend (satellites, robotics, quantum, AI) focusing only those that rallied significantly year-to-date with unchanged/negative earnings revisions. 

Remarkably, as the chart below show, the "HALO'd out" stocks have actually outperformed the high intensity HALO basket YTD, meaning that the market has indiscriminately rewarded high asset companies even though their returns have notably lagged the high intensity basket.

As Goldman notes, reflecting the increasing investor desire for “AI insulation” which means discarding asset-lite stocks which performed so well for years, asset-heavy stocks have outperformed sharply in the last few months. Asset intensity is defined as the ratio of a company’s assets, less cash and intangibles, to revenues.

After years of asset-light outperformance, Goldman's sector-neutral basket of tangible asset-heavy stocks (GSTHHAIR) has outperformed the basket of asset-light stocks (GSTHLAIR) by  a whopping 20% since the start of November.

Meanwhile, the GSXUHALT basket which Goldman is now going short filters for the companies that have rallied in line with GSTHHAIR but have no earnings growth estimates to justify this rally. 

Equities that have "HALO’d too far": red line below:

GSXUHALT can be paired with thematic trends the bank likes on the long side, following the recent price action that has created the biggest "buy the dip" opportunity in global equities since Liberation Day.

Some more excerpts from the Goldman note:

Last month, GS research pointed out that asset-heavy stocks are now trading at a premium to their asset-light counterparts. As of last month, the 3% P/E premium ranked in the 62nd percentile of the last couple decades and remains below past peaks in 2004, 2012, and 2022.

While the GSXUHALT basket was trading in-line with earnings until late last year, it has diverged aggressively of late: 

GSXUHALT has an average asset intensity ratio of ~1.4 and successfully excludes companies exposed to secular trends like satellites, robotics, quantum, AI that could continue to outperform: 

GSXUHALT has rallied in line with the diversified High Asset Intensity basket (GSTHHAIR) and is pulling back post the February-end peak: 

More in the full note available to pro subs.