2015 – A Very Good Result!

Our investors enjoyed another year of very solid returns across our range of funds in 2015.
 

These numbers continue to build on a healthy series of returns over recent years. Over the past three years for example, the Appian Value Fund is ahead by 26%, the Equity Fund by 48% and the Small Companies Opportunities Fund by 88%!

Investment returns were hard-won in 2015.

There was no shortage of “event risks” for financial markets to deal with; Greece dominated much of the early part of the year only to be replaced by fears of a stalling Chinese economy, and a less than sure-footed US Federal Reserve as it contemplated hiking interest rates, as the year progressed. In many cases equity indices made little progress; the US S&P index was essentially flat on the year while major markets such as the UK were negative. Equity markets also endured spikes in volatility and a lack of breadth that unnerved investors. Volatility wasn’t confined to equities. Government bond markets experienced unprecedented moves notably in April to June which saw, for example, German 10 year yields go from close to zero to almost 1% in a matter of weeks. For Euro-based investors, currencies were supportive with a weaker Euro, and broadly represented the divergence in global interest rate policy as US and UK rates are set to rise while interest rates in the Eurozone remain frozen.

The outline of the investment landscape remains broadly similar to last year. We are still in a pro-longed period of low interest rates and inflation, and economic growth while recovering is not as robust as we would like. Valuation levels across many asset classes leave little room for disappointment. Managing the volatility of the investment outcomes and maintaining a truly dynamic approach to asset allocation are we believe more important than ever in this financial environment.
 
2016 will no doubt present a similar set of challenges for financial markets. Concerns over economic growth in China, the next phase of US interest rate policy, the implosion in Syria and the increasing proximity of a “Brexit” referendum will certainly be on that list -- doubtless amongst others.

Our approach and philosophy at Appian remains constant. At the individual stock level we focus on quality fundamentals like balance sheet strength, strong cash-flows and solid and sustainable dividend income. Our overall asset positioning will reflect where we see the best trade-off between risk and return as we move through the cycle.
 
Throughout 2016 we will remain focussed on this underlying quality and alert to opportunity. 

For more detailed information on each of our funds click here