Goldman Sachs’ non-AI S&P 500 index outperforms regular index since June

For years, the winning trade on Wall Street was simple: buy anything touched by artificial intelligence and wait. That trade is now running in reverse, and Goldman Sachs built an entire index to prove it.

The S&P 500 ex-AI index, ticker SPXXAI, has outperformed the regular S&P 500 since late June. Investors are piling into sectors with minimal AI exposure, including biotech, regional banks, and consumer entertainment, treating the absence of AI as a feature rather than a bug.

The index Wall Street didn’t know it needed

Goldman Sachs launched SPXXAI on February 20, 2026, in collaboration with S&P Dow Jones Indices. The concept is straightforward: take the S&P 500 and remove the companies enabling the AI boom.

The excluded AI-enabling companies represent about 45% of the S&P 500’s total market capitalization. Over the three years leading up to the launch, the full S&P 500 delivered a total return of 76%. The ex-AI version? Just 32%.

A historic decoupling

By late June 2026, the correlation between Goldman’s US Broad AI Index and the S&P 500 ex-AI Index plunged to between -0.53 and -0.60. That’s not just low correlation. That’s actively inverse movement, a phenomenon rarely observed between segments of the same broad market.

Goldman strategist Ben Snider identified three non-AI investment themes driving the outperformance by July 2026. First, consumer experience stocks, companies in entertainment and hospitality. Second, so-called “compounders” with consistent earnings growth. Third, potential M&A candidates that could benefit from dealmaking activity.

The consumer experience basket alone delivered striking results. An equal-weighted group of 36 consumer-experience stocks returned 17% year-to-date by July 2026, outperforming the broader consumer discretionary sector by 17 percentage points.

Hedge funds caught offside

July 2026 marked the worst single-month underperformance of Goldman’s Hedge Fund VIP list relative to the S&P 500 in over 20 years. The VIP list tracks the most popular holdings among hedge funds, which had been heavily skewed toward AI names.

When hedge fund managers began pulling back from AI exposure mid-year, they essentially sold into weakness. Reducing positions in underperforming AI stocks while the non-AI side of the market surged created a double hit to returns.