A Sydney-based hedge fund believes the recent sell-off in software stocks has bottomed out and has bought technology shares worth approximately A$200 million (US$143 million) during this downturn.
GCQ Capital Management raised funds by selling some of its best-performing holdings, including European luxury goods companies, and shifted its focus to battered software stocks. According to Doug Tynan, the firm’s Chief Investment Officer, their targets in recent weeks have included Microsoft, accounting software company Intuit, and tech giant SAP.
Prior to this, a series of technological updates from startups like Anthropic had intensified market doubts about the short-term prospects of the software industry, dragging tech companies into the so-called “AI panic trade.” Earlier this week, a little-known firm, Citrini Research, published a blog post outlining a grim scenario of technological disruption, sparking fresh concerns about the software sector’s vulnerability to rapid AI iterations and causing further declines in the stock market.
Commenting on Citrini’s blog post, Tynan said this Monday was one of the strangest days he has seen in the market—a sci-fi hypothetical scenario proposed by an obscure individual not only caused the market to fall but even drew comments from the White House. He believes this precisely indicates that the market bottom has arrived.
Since then, U.S. software stocks have rebounded from Monday’s plunge, rising for the third consecutive session as of Thursday, with investors once again placing bets on companies actively embracing emerging technologies. Block Inc. saw its stock surge 25% in after-hours trading following its announcement to cut nearly half of its workforce (approximately 4,000 employees) as part of its transition towards artificial intelligence.
GCQ, which manages A$2 billion in assets, has faced its own challenges, with underperformance in some of its heavyweight holdings dragging down returns. For instance, shares of Swedish property portal Hemnet Group have fallen over 70% from their 2025 highs.
Nevertheless, the fund is on track to post a record monthly net inflow in February, following A$50 million in January. Both its distribution team and Tynan himself are encouraging clients to take advantage of the low prices in software stocks to position themselves.
Tynan stated that the greatest disruption occurred last week and described this sell-off in software stocks as one of the most illogical market sell-offs he has ever witnessed.
GCQ has also doubled down on property portals, purchasing shares in the UK’s Rightmove PLC and SMG Swiss Market Group, while increasing its stake in Hemnet after earlier reducing it due to falling share prices.
