Aviva is latest to drop Woodford fund

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Aviva is latest to drop Woodford fund

Star manager Neil Woodford has been dropped by a second large investment house.

Aviva confirmed today (16 November) that it is dropping Mr Woodford’s Equity Income fund, and those who have invested in it through company pension schemes will have money moved to an alternative fund.

The move will affect at least £30m of capital.

Mr Woodford’s equity income fund has significantly underperformed rivals and the stock market as a whole in the last 12 months, as has his second launch, Woodford Patient Capital trust.

Last month it was revealed that Jupiter, a long-term Woodford backer, had dis-invested entirely from Mr Woodford's flagship income fund.

Aviva confirmed today that it has also dropped the fund.

Pension customers who do not reply to a letter from the insurer asking them to choose a new fund, will have their money automatically moved into the Threadneedle UK Equity Income portfolio.

The change only affects those who make their own investment decisions with their pensions, as Aviva does not hold Woodford in its pension default funds.

A spokesman for Mr Woodford confirmed the news.

He said: “We can confirm that Aviva has removed the Aviva CF Woodford Equity Income fund from its unit-linked insurance platform.

"As a result the fund will close on 4 December 2017."

Aviva customers who have financial advisers can still invest in the fund, as it is available on the adviser-only wrap platform.

The Woodford fund has been hit by sharp falls in the price of major holdings Provident Financial and AstraZeneca.

The Woodford fund has underperformed on a one and three-year basis.

Over the past year it has returned 0.08 per cent against the FTSE All Share’s 13.4 per cent increase.

Over three years it has returned 21.1 per cent, but the wider market has returned 26.7 per cent. The fund was launched three years ago.

An Aviva spokesperson said: “As part of our standard processes for overseeing the funds we offer, we regularly review them against technical criteria and it is not unusual to change the fund mix. We do not comment publicly on the detail of those reviews.”