Download the PDF update (September 2026)
About the fund
The Deep Value Fund is a wholesale fund investing in a concentrated portfolio of undervalued, profitable, and growing ASX listed microcap and smallcap companies.
Performance
| Period | Fund |
|---|---|
| Compound p.a. since Inception | 11.59% |
| Total since inception | 587.22% |
| 15 Year Compound Annual | 8.76% |
| 10 Year Compound Annual | 0.18% |
| 5 Year Compound Annual | -6.53% |
| 3 Year Compound Annual | -7.95% |
| 1 Year | -33.73% |
| 1 Month | -9.04% |
Past performance is not indicative of future performance.
Value of $1,000,000 invested at inception
- Deep Value Fund: $1,000,000 to $6,872,222
- All Ords Accumulation Index: $1,000,000 to $5,802,709
- S&P/ASX Small Ords Accumulation: $1,000,000 to $3,900,526
Market update and commentary
World equity markets have become increasingly concerned about the rise in the US 10-year Treasury yield, widely regarded as a proxy for the risk-free rate and therefore an important input in the valuation of many financial securities. The US 10-year Treasury yield has increased by circa 1% to currently sit around 5.24%. The rise in yields also makes it more expensive for the US Government to issue and recycle federal debt. The rise in US bond yields is being driven by several facets, including increasing competition in private markets (think about the private debt funding the AI capex boom), inflationary concerns and mounting US debt.
In Australia, the RBA increased its official cash rate 25bps to 4.60% in a highly expected and telegraphed move. As we noted some time ago, we expected at least 2 rate rises before a potential change in the monetary policy cycle, and we maintain the thesis as still the most plausible framework. Whilst some commentators are predicting 3 rate rises in total (inclusive of the September rate rise), we think there is evident data that the slowdown in spending and likely loosening of labour markets has already started to take place, giving the RBA time to ingest the likely slowdown in the economy and the impact of higher rates.
Microequities Deep Value Fund returned -9.04% in September; this brings the total return net of fees to 587.22% for the Fund since inception in March 2009.
A challenging month in terms of market prices, but we want to call out that there was no news flow specific to our Deep Value Fund constituents to explain the decline in their market prices. We do think trepidation around bond yields has adversely impacted equity values, and this has been more pronounced in the microcap and small cap asset class.
Of the little news flow during the month, hospital software provider Alcidion Group Ltd (ASX:ALC) announced a contract with total value of A$7.5m with Northern Care Alliance NHS Foundation Trust. The contract is both a renewal and an expansion: with ExtraMed already being used and renewed, the Trust will now also implement the Miya Flow solution.
OFX Group Ltd (ASX:OFX) also updated the market on the proposed takeover, stating that Equals had substantively completed confirmatory due diligence. OFX had granted Equals an exclusivity extension until the end of October to obtain its financing.
Portfolio breakdown
Sector breakdown
Market capitalisation
Percentages are of fund net asset value and may not sum to exactly 100% due to rounding.
Portfolio
Important information: This information is not intended to be financial advice. Past performance is not indicative of future performance. Microequities Asset Management Pty Ltd is a corporate authorised representative, number 462438, as appointed by Microequities Asset Management Group Limited holder of AFSL number 287526. Application for units in the Fund is limited to investors that are wholesale or sophisticated investors within the meaning of Section 761G(7) and 761GA(7) of the Corporations Act 2001.