What stocks should you stick with when markets get choppy?

Open this photo in gallery:Nuthawut Somsuk/iStockPhoto / Getty ImagesShareSave for laterPlease log in to bookmark this story.Log InCreate Free AccountHappy Tuesday, Trade Off friends.Jon Erlichman here with another edition of Trade Secrets, our weekly newsletter for The Globe and Mail’s stock picking contest, Trade Off.Was this newsletter forwarded to you? Be sure to sign up to receive the Trade Secrets newsletter in your inbox.The leaderboardA quick peek at the leaderboard tells a pretty clear story about what’s been working since gameplay began in late March. Tech strength, and more specifically the strength of the chip companies at the centre of the AI boom, has helped the top performers stand out. Quick math shows a double-digit percentage return for the NASDAQ 100 in that stretch, and some of the hottest names within it, such as AMD and Western Digital, are showing up in a lot of the better performing portfolios.window.addEventListener("message",function(a){if(void 0!==a.data["datawrapper-height"]){var e=document.querySelectorAll("iframe");for(var t in a.data["datawrapper-height"])for(var r,i=0;r=e[i];i++)if(r.contentWindow===a.source){var d=a.data["datawrapper-height"][t]+"px";r.style.height=d}}});And it’s not just an American story. Canadian companies viewed as having an AI advantage have done well too. That’s why a name like Celestica keeps popping up in outperforming portfolios.Players who leaned into the AI trade early have been rewarded. But the bigger question for long-term investors is figuring out which of these names have the staying power to keep delivering when the market gets choppy again.This week in markets One of the most beneficial parts of a competition like Trade Off is that it forces you to think about what actually makes a stock worth owning. Not just this week, but over time.A few weeks ago, we talked about how resilient markets can be. After the S&P 500 flirted with correction territory earlier this year, it has come roaring back, on pace for its best performing month since 2020. But not every stock bounces back the same way. Some never do. So how do the pros decide which names are worth sticking with when the market gets choppy?On the latest episode of my investing show, Ticker Take, I put that question to Thomas Martin, senior portfolio manager at Globalt Investments. Martin starts with companies that can perform sustainably, meaning growing revenues, expanding margins, and earnings per share that consistently beat Wall Street expectations. From there, he looks for something extra: a clear leadership position, a durable competitive advantage, and a culture of innovation. The discipline, he says, is in separating the hiccups from the breakdowns.Martin shared 12 names he believes are bruised but built to last, including Microsoft, Visa, Uber, Palantir, Spotify and AppLovin. You can find his full breakdown on Ticker Take.Built to last as a groupThe ‘built to last’ idea is also showing up at the sector level. Investor Josh Brown recently coined the term HALO stocks, which stands for Heavy Assets, Low Obsolescence. In a world where investors worry about which businesses AI might disrupt, there’s a group of companies with massive physical footprints, such as railroads, pipelines, utilities and heavy industrials, that are much harder to replace with a piece of software.Bloomberg has a basket of HALO stocks easily beating the market this year. The 10 names with the strongest ratings right now are Freeport-McMoRan,…

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