Equity IncomeMar 21 2017

Woodford flagship fund hits £10bn

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Woodford flagship fund hits £10bn

Neil Woodford has breezed past the £10bn milestone for his flagship equity income fund, less than three years after its launch.

The Woodford Equity Income fund managed to raise a record-breaking £1.6bn when it launched back in June 2014 and has regularly featured high on most popular fund lists.

Despite a disappointing 2016, the Equity Income fund is still the top performer in the UK Equity Income sector.

Since its launch it has returned 30.3 per cent, compared to the average fund in the sector which has returned 19.2 per cent - performance which has encouraged assets to pour in.

Laith Khalaf, senior analyst at Hargreaves Lansdown, said Mr Woodford has managed to protect investors in times of market turmoil, adding: “You don’t get a fund that big without earning the trust of a large number of investors.”

This comes on the same day Woodford Investment Management opened its third offering, the Woodford Income Focus fund.

The new fund will be more concentrated, holding around 50 stocks, and although it will largely be UK-based from the start, it will also have the flexibility to invest internationally.

It’s a bit like being able to pick up a Rolls Royce for the cost of a Fiat Panda Laith Khalaf

Mr Khalaf said: “Neil Woodford puts bums on seats, and we expect plenty of investor interest in his new high yield offering, particularly when many income-seekers have been left high and dry by low interest rates.”

He said investors might expect to have to pay a premium to get access to Mr Woodford’s skills and expertise, but said in fact his funds are available to investors for a lower annual charge than many of his peers. 

“It’s a bit like being able to pick up a Rolls Royce for the cost of a Fiat Panda,” he said.

Hargreaves has also added the newly created Woodford Income Focus fund to its Wealth 150 Plus list, with an ongoing fund charge of 0.6 per cent. 

katherine.denham@ft.com