As asset protectors, Appian's investment style centres on "value investing". We seek to buy excellent assets at reasonable prices. Investment opportunities are created by discrepancies between stock prices and the underlying value of the asset. This underlying value is estimated via discounted cash returns and appraised asset values. The objective of value investing is long term capital appreciation subject to protecting the original capital.
Value investing is centred around fundamental analysis. The basis of fundamental analysis is the financial analysis of individual company reports, including profit/loss, balance sheets and cash flow statements. The fundamental approach takes as given, that asset prices do not always equal true value because the market can at times be irrational and inefficient.
Not all assets are efficiently priced, therefore as an investment manager Appian requires patience before it experiences an opportunity to make an investment. Other characteristics needed for value investors include self discipline, independent critical thinking, thoroughness, perseverance and courage of conviction.
Appian's investment process consists of a framework that looks at the macro economic environment, the individual investment and the underlying characteristics of it. This combination ensures that we are not over exposed to any one asset class (Cash, Bonds, Equities and Property) and at the same time allows us to focus on the characteristics of each individual investment made.
An asset allocation split is decided upon by the investment committee of Appian based on their observations of the Macro Economic Environment and the intrinsic value of each individual asset class at a particular time. The allocation of the investor's funds is centred on the following asset classes as mentioned above:
Post the allocations of the assets within a balanced portfolio, Appian ensures that each individual investment meets the criteria of value investing and the risk parameters of each individual investor.