A sustained bout under performance from fund manager Neil Woodford hasn’t put off Sheridan Admans, who runs the Share Centres fund of fund range, from ploughing more capital into the manager's funds.
Mr Woodford’s £6.6bn Equity Income fund is the absolute worst performer in the IA UK Equity Income sector over six months, one year and three years, all data to 20 March.
It has shed around £4bn in less than 12 months, and was today (22 March) booted out of the IA Equity Income sector because it has failed to meet the required income targets.
But Mr Admans said he has continued to buy units of the Woodford investment for the £100m fund of fund range he runs for the Share Centre.
He said: “We generally have a view of the world that says there are long-term deflationary trends as a result of technological change and ageing populations.
"The market has more recently been focused on inflationary pressures that are more short term. But we think we are at the start of a new industrial revolution and so want exposure to areas such as healthcare and technology.
"It is one of the big questions in the market right now, the UK is the cheap market, it is the place for the contrarian investor to be, yet it is the market that has lots of mining and resource stocks, and not much tech.
"But Neil Woodford has investments in the areas we like, and in lots of unquoted companies in areas like technology.”
Mr Admans added Mr Woodford has had period of under performance in the past only to be vindicated later.
He said early stage technology companies can thrive whatever happens in the wider economy.
Aside from the Woodford fund, much of the exposure Mr Admans has to technology and healthcare comes from passive investments.
He said relatively few active fund managers who invest in those areas have a track record of being able to outperform the market.
He also has exposure to Japan, as he said this is a market where the various themes that interest him come together, with technological innovation such as robotics, and companies manufacturing products for older people a significant part of the Japanese stock market.
Mr Admans' support for Mr Woodford comes as the embattled fund manager received a boost with the news one of his ten largest investments Prothena, a biotech company, had agreed a partnership with Celgene, a bigger US firm, that could be worth billions to Prothena.
A Woodford Investment Management spokesperson said: “The deal makes perfect strategic sense for Prothena and allows its R&D engine to be funded by one of the leading US biotech companies.”
Prothena's positive news has boosted Mr Woodford's Patient Capital investment trust. The shares are up 9 per cent on 21 March.
David.Thorpe@ft.com
