Neil Woodford’s soon-to-be-launched investment trust is unlikely to ever appear on the Hargreaves Lansdown Wealth 150, the Bristol-based advisory firm’s list of recommended funds.
Applications for Mr Woodford’s new Woodford Patient Capital Trust are open, with an estimated strike date of 13 April and a fixed price of 100p a share. The minimum investment in the fund will be £1,000.
However, although the broker has mentioned the new investment trust several times in client literature, it has not been put on its Wealth 150.
This is despite Mr Woodford’s open-ended fund, the £5bn Woodford Equity Income launched less than a year ago, making it onto the list even though it does not have a one-year track record.
Right to reply
Richard Troue, investment analyst for Hargreaves Lansdown, said there had never been investment trusts on the Wealth 150.
“The problem with a lot of investment trusts is that the closed-ended structure can make them a lot less liquid,” he said.
“Although some trade a lot of shares, if we were to recommend Woodford’s trust on the Wealth 150, it would generate a high influx of shares, which could see the trust move from a discount to a premium in a short space of time. If we took it off the Wealth 150, the opposite could happen, and we just don’t want to cause huge fluctuations in the share price.
“Mr Woodford’s long track record in the UK equity income space meant we put his open-ended fund on the Wealth 150, but his trust is a different kettle of fish. While we like the sound of what he will be doing, this isn’t a reason to put it on the Wealth 150.”
