Where do you draw the line for idio vs systematic? The drawdown chart might look a bit more systematic if compared to other data cos / software etc? Definitely appreciate the point you're making and agree to a large extent, but drawdowns for a sector / broad peer group can also have a systematic element to them where the opportunity is the proverbial baby in the bathwater? (Not that Factset would necessarily be said baby in the current drawdown, mind...)
It's a good question, William. Copart (which I own) might have been a cleaner example of an idiosyncratic sell off versus FDS given the current broader software sell-off. While the current software sell-off isn't systematic, it isn't strictly unique to FDS, either, as terminal values are being questioned across the software space. Even so, the FDS example highlights that when a specific sub-industry sells off for fundamental reasons, you need both an analytical and behavioral thesis before stepping in.
Where do you draw the line for idio vs systematic? The drawdown chart might look a bit more systematic if compared to other data cos / software etc? Definitely appreciate the point you're making and agree to a large extent, but drawdowns for a sector / broad peer group can also have a systematic element to them where the opportunity is the proverbial baby in the bathwater? (Not that Factset would necessarily be said baby in the current drawdown, mind...)
It's a good question, William. Copart (which I own) might have been a cleaner example of an idiosyncratic sell off versus FDS given the current broader software sell-off. While the current software sell-off isn't systematic, it isn't strictly unique to FDS, either, as terminal values are being questioned across the software space. Even so, the FDS example highlights that when a specific sub-industry sells off for fundamental reasons, you need both an analytical and behavioral thesis before stepping in.
i hope this means a non-paywalled follow-up on cprt in this perspective !
I would really love a write up on Copart..