Call Richard Cook: 07770 575 122

email: richard@theinvestmentandretirementcoach.co.uk

Stock Market Recovery? Don't Bank on it

Another nail in Woodford’s coffin

My apologies for banging on about this if you have already sold your Woodford funds but an article in this weekend’s Times indicates just how tough he is finding things.

They reported that he has dumped his entire stake in one of the UK’s most promising science companies. The suggestion was that the holding was sold not because it was a bad investment but because it was the easiest to sell.

Once a fund manager starts selling his best investment to pay out investors who are leaving his fund he is on a slippery slope from which recovery is almost impossible. His Equity Income Fund has shrunk from £10.2bn to £4.4bn. Still a massive fund so not everyone has sold out but the numbers who have sold tell their own story.

Morningstar, one of the biggest rating agencies, have recently downgraded the fund to “neutral” (its second lowest rating) and SJP, Britain’s biggest wealth manager, has put the fund on its “watch list”.

Woodford has produced excellent results for the holders of his funds (and I was one of them) over very many years and I wish I had something positive to report but that is just not the case.

I am not a regulated financial adviser and nothing I say should be interpreted as personal advice, but I believe this is now a high risk fund with limited recovery prospects. If you are looking for an alternative equity income fund one of the best places to start is the UK Equity Income sector of Hargreaves Lansdown’s Wealth 50 list.   Hargreaves Lansdown are still Woodford supporters, possibly because they hold so much of his fund that they cannot afford not to be, but I still have faith in their investment research dept and the Wealth 50 list in general.

Hopefully this is my last blog on the subject. Hargreaves Lansdown may still be Woodford supporters but this is one of the rare occasions where I cannot agree and therefore sold my Woodford holdings some time ago.

As mentioned above I cannot make personal investment recommendations but if you would welcome some guidance on how to build and monitor your own investment/pension portfolio please phone or text me, Richard, on 07770 575122,and let’s have a conversation.

If you have not sold your Woodford Funds by now I sincerely hope it all works out for you but I just can’t get away from the thought that the risks are now greater than the potential rewards.


This document and our on going services are not personal advice. We'll give you all the help and guidance you need to make your investment and retirement decisions, but we can't advise you. If you're not sure whether you need regulated financial advice we can put you in touch with a suitably qualified and experienced regulated adviser. Because we are not regulated by the Financial Conduct Authority you will not have access to the Financial Ombudsman Service in respect of any complaints. If you use one of the "no advice" on line services to handle investment transactions they will be Regulated and you will have access to the Ombudsman and The Financial Compensation Scheme in respect of their services. The value of investments/pension plans can fall or rise depending on market performance. The Retirement Team and The Investment and Retirement Coach are trading names of Capture Success Ltd Reg No 01825075 Tel 07770575122

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