It’s Still One Trade

Here’s the part of this market that gets overcomplicated on purpose.

This isn’t a dozen different rotations.
It isn’t a complex web of clever factor bets.
And it definitely isn’t as hard as it’s being sold.

Right now, the market is making one distinction:

Software.
Everything else.

That’s it.

Small caps?
Value?
International?
Emerging markets?

Different labels. Same exposure.

Strip away the wrappers and you see the same structural reality underneath: most of what people call “diversification” is just being underweight software in slightly different ways.

You can slice charts however you want.
You can build elegant narratives and attach clean sector labels.

But the tape keeps saying the same thing.

Capital has been crowded into software leadership for years. That trade got heavy. When positioning stretches, money doesn’t rotate neatly — it floods outward together into anything that isn’t overloaded.

That’s why these “separate” trades move in sync.
That’s why relative performance compresses.
That’s why this feels confusing if you’re treating them as independent ideas.

They aren’t.

This isn’t ten smart trades.
It’s one trade wearing different costumes.

And right now, that trade is working.

Most investors chase labels instead of understanding exposure.

They wait for permission.
They want the list first… then decide if they believe the thesis.

I do it the other way around.

I define the bucket.
I understand the positioning.
Then I fill it deliberately.

Which brings us back to software.

Because if “everything else” is catching a bid precisely because software has been avoided, then the long-term move isn’t to abandon software.

It’s to quietly build the software bench.

If I’m thinking in years, not quarters, these are the businesses I want compounding in the background while the market argues about narratives.