Neil Woodford is a clever man. He’s as close as any fund manager comes to being a household name. The Tess Daly of fund managers :0) He’s ditched the power suits and the City office which turns people off. And set up on his own with blogs and clever PR.
There’s just one problem. Since November 2015, his fund has returned about 3% compared to the FTSE All Share’s 30%. With a 25 month underperformance run. But before we all mumble into our sandwiches about useless and bah humbug, it’s not the first time he has gone against the crowd. And time has proven him right. From the time his last underperformance period came to an end in January 2011, going up to December 2017, he has doubled his investors’ money, compared to a comparative 80% return in the FTSE All Share.
So what to make of it? My general feeling is that there are few very good managers who have the skill to justify their fees. Terry Smith is another UK darling – he’s currently riding high. I personally rate Lindsell Train. Will time prove Woodford right?
Supporters will say that he knows his stuff and ups and downs are the nature of the beast (when the beast actually makes decisions and doesn’t charge high fees to just buy the same as everyone else and hedge their bets in a chicken-y way.)
Detractors will say that you’re better off in a cheaper so-called passive fund where you pay less and know that you won’t shoot the lights out but by definition you’ll be average, literally buying a little piece of everything
Here’s what Hargreaves' Mark Dampier had to say in response to a reader’s question on whether it was time to dump Woodford.
This week we’re also sharing a sample of some of the other questions which are bugging people – if you have a question then fire away in our Ask section and we’ll do our best to get you a reply. These three are a taster of what is tackled here.
Lots of questions relate to the best platforms to use and our Best Buyssection tackles this. If you can share a review to help us provide better feedback then please use this link to share your experience in confidence.
As a final note this week, miserable January sees a boom in divorce enquiries. Jolly jolly. If this is you, or someone you know, we’ve updated our no-nonsense Money Guide to Divorce with facts, tips and feedback from experts and those who have been there, done that and kept (half of) the T-Shirt.
Have a great weekend