Citrini Scare Marks Potential Bottom, Fund Sees Bounce Opportunity

GCQ Funds Management Sees Bottom in Software Selloff, Snaps Up A$200 Million in Tech Stocks

GCQ Funds Management, a Sydney-based hedge fund, is betting that the bottom is in for the software selloff, having invested approximately A$200 million ($143 million) in tech stocks that have been hit by the so-called "AI scare trade." The fund has been targeting companies such as Microsoft Corp, Intuit Inc, and SAP SE in recent weeks, according to Chief Investment Officer Doug Tynan.

The technology sector has been impacted by a string of updates from startups, including Anthropic PBC, which revived doubts about the sector's near-term prospects. The slump was exacerbated by a blog post from Citrini Research, which sketched a stark disruption scenario, stoking worries about the sector's vulnerability to rapid advancements in AI.

US software stocks have since rebounded from Monday's slump, rising for a third session through Thursday as investors renewed bets on companies making strident moves to embrace the emerging technology. Block Inc. shares soared 25% in after-market trading after the company said it would cut almost half its workforce as part of a pivot toward AI.

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GCQ Funds Management, which has A$2 billion in assets under management, has faced its own challenges with underperformance among its largest holdings weighing on performance. However, the firm is on pace for record monthly net inflows in February after attracting A$50 million last month, as its distribution team and Tynan himself urged clients to take advantage of cheap software stocks.

The fund has also doubled down on property portals, buying the UK's Rightmove PLC and SMG Swiss Marketplace Group AG, and added to its position in Hemnet Group AB, which is more than 70% below its 2025 high.