Investment Newsletter - June 2014

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Investment Newsletter June 2014

Can’t see the Woodford... By Mike Deverell Investment Manager

There have been plenty of headlines about the new fund from Neil Woodford. This is the most eagerly anticipated fund launch since Anthony Bolton, once of Fidelity’s Special Situations and one of the UK’s best known fund managers, ventured to China to try his hand out there. Bolton’s venture had limited success, with him unable to translate his long history of outperformance investing in UK stocks to the Chinese market. Woodford’s case is different. Having left Invesco Perpetual, for whom he ran their successful Income and High Income funds for more than 20 years, he set up his own firm, Woodford Investment Management. He is launching an equity income fund with exactly the same strategy he pursued at Invesco.

questions I wanted answered were why he had decided to go it alone, and would he be able to replicate his performance at his new firm. On the first question he was somewhat cagey, saying only that he felt the structure of the firm at Invesco was not the ideal way to support a fund manager. There was too much demand on his time away from his main role, which was to run his fund. He wanted to set up a modern firm designed purely to support the manager in running the fund. To that end he has hired in several analysts who are purely dedicated to feeding him ideas for his fund. At Invesco, although there was a wider team with whom in theory he ought to be able to share ideas, he felt that in practice this did not happen as all his colleagues were busy running their own funds.

When I met Woodford a few weeks ago the two main Equilibrium Asset Management LLP (a limited liability partnership) is authorised and regulated by the Financial Conduct Authority. Equilibrium Asset Management is entered on the Financial Services Register under reference 452261. The FCA regulates advice which we provide on investment and insurance business; however it does not regulate advice which we provide purely in respect of taxation matters. Copyright Equilibrium Asset Management LLP. Not to be reproduced without permission.


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