Panic is never a great attitude to have in investing, but neither is blind optimism. So it’s probably healthy for Alibaba (NYSE:BABA) shareholders not to get too overwhelmed by the ongoing Chinese regulatory crackdown, but also not blindly buy the stock just because it’s down and other famous investors like Charlie Munger are doing so.

Alibaba released its third-quarter earnings report on Thursday, Nov. 18, and the stock plunged over 10% on the news. While the period did encompass a tumultuous summer for the Chinese economy, some figures did seem to confirm the worst fears over Alibaba’s business.

The biggest fear I had amid China’s regulatory crackdown wasn’t necessarily punishing fines or the seizure of Alibaba’s business. Amid all of the ideological uproar, China’s intention seems to be to level the playing field among businesses and create a more equal and competitive society. Those are all worthy goals, but if successful, new regulations could eat away at Alibaba’s competitive advantages.