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10k Words Equitable Investors October 2025 Small stocks are making up some lost ground with investor interest returning. Size has been the key factor on the ASX over the past 12 months, whereas in the US it has only come to the fore in the past three months. Australian 10 year bond yields have been pretty stable for the past few years but political turmoil in Japan and France shows up in their equivalent bond yields. The extent to which AI is dominating venture funding is unprecedented. But so is the extent to which Nvidia dominates the total value of Australia's top 200 companies. Surging earnings is the difference when comparing Nvidia's valuation to that of Cisco during the dot com boom. The economy is certainly relying more heavily on tech sector capex - and anticipating 4x growth in power demand from AI data centres over the next 10 years. Finally, we still have over 1,000 companies a month entering external administration in Australia, compared to just over 500 a month between FY2020 and FY2023. Record weekly value of trade in S&P/ASX Emerging Companies stocks (5 highest weekly amounts since 2004 v averages)
Source: Equitable Investors, Iress One year returns - Australian small caps leading large caps in Aus and US
Source: Koyfin Ten year returns - small caps still lagging
Source: Koyfin ETF-based factor analysis highlgiths size as the key on the ASX over the past 12 months
Source: Equitable Investors US factor ETF performance / S&P 500 ETF performance over past 3 months
Source: Koyfin 10 year Japanese government bond yield
Source: WSJ.com 10 year French government bond yield
Source: WSJ.com 10 year Australian government bond yield
Source: WSJ.com AI's share of value of venture deals over trailing 12 months
Source: PitchBook Nvidia's market cap and PE multiple relative to the S&P/ASX 200
Source: Equitable Investors, Koyfin Cisco v Nvidia in terms of market cap and net income (net profit)
Source: Koyfin US real GDP growth contribution from tech capex
Source: JP Morgan Bridgewater Power demand from AI data centres to quadruple in 10 years according to Bloomberg
Source: Bloomberg NEF The first time an Australian company enters external administration or has a controller appointed - monthly
Soure: ASIC Funds operated by this manager: Equitable Investors Dragonfly Fund Disclaimer Past performance is not a reliable indicator of future performance. Fund returns are quoted net of all fees, expenses and accrued performance fees. Delivery of this report to a recipient should not be relied on as a representation that there has been no change since the preparation date in the affairs or financial condition of the Fund or the Trustee; or that the information contained in this report remains accurate or complete at any time after the preparation date. Equitable Investors Pty Ltd (EI) does not guarantee or make any representation or warranty as to the accuracy or completeness of the information in this report. To the extent permitted by law, EI disclaims all liability that may otherwise arise due to any information in this report being inaccurate or information being omitted. This report does not take into account the particular investment objectives, financial situation and needs of potential investors. Before making a decision to invest in the Fund the recipient should obtain professional advice. This report does not purport to contain all the information that the recipient may require to evaluate a possible investment in the Fund. The recipient should conduct their own independent analysis of the Fund and refer to the current Information Memorandum, which is available from EI. |
