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Woodford Equity Income Fund – the fallout continues

  • By Andrew Sullivan
  • News

Hargreaves Lansdown will waive its platform fee while the fund’s dealing is suspended, while St James’s Place has dropped Neil Woodford as manager of £3.5bn of its funds, replacing him with Columbia Threadneedle and RWC Partners.


 

Emma Wall, Head of Investment Analysis, Hargreaves Lansdown commented:

“We have taken the decision to waive the platform fee on the Woodford Equity Income fund while dealing is suspended, effective immediately. We do not think it is fair to charge our clients a fee while they cannot trade in the fund. This is a frustrating and difficult time for clients and we are doing what we can to support them. We have been in communication with Woodford Investment Management to explain why we think this is the right thing to do and have put pressure on them to do the same.”

The funds Woodford has run for St James’s Place are separate mandates, and the advice group said it believed the switch would ‘ensure its clients’ investments continue to be managed effectively’.

St James’s Place has handed the mandate for the £1.4 billion St James’s Place UK High Income, £1.5 billion Income Distribution and  UK Equity funds to Richard Colwell of Columbia Threadneedle and Nick Purves of RWC.

As with Woodford’s flagship Woodford Equity Income fund, performance of the manager’s St James’s Place funds has deteriorated significantly over the last two years.

But there are important differences between the St James’s Place funds and Woodford’s own Woodford Equity Income fund.

His suspended fund features a sizeable allocation to unquoted companies, but they do not feature in the funds he has run for the national financial advice group, which in 2014 limited the UK companies he could buy to FTSE 100 and FTSE 250 stocks.

Woodford has run funds for St James’s Place since 2001. The financial advice group followed the manager when he left Invesco to set up his own fund group in 2014.

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