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  • FIRST POST
    • Zola.
    • By Zola. 7th Sep 17, 7:35 PM
    • 1,102Posts
    • 428Thanks
    Zola.
    Woodford apologises for performance
    • #1
    • 7th Sep 17, 7:35 PM
    Woodford apologises for performance 7th Sep 17 at 7:35 PM
    http://www.telegraph.co.uk/business/2017/09/06/neil-woodford-right-criticised-sorry/

    Another case for following the passive path and not chasing last year's fashionable star fund manager ?
    Last edited by Zola.; 07-09-2017 at 7:38 PM.
Page 1
    • bostonerimus
    • By bostonerimus 7th Sep 17, 8:32 PM
    • 1,107 Posts
    • 621 Thanks
    bostonerimus
    • #2
    • 7th Sep 17, 8:32 PM
    • #2
    • 7th Sep 17, 8:32 PM
    Woodford was the last decade's star so I can see why people would stay with him after he set up his own funds. And what if this last year is just a blip and he out performs for the next decade? Do you feel lucky.......punk
    Misanthrope in search of similar for mutual loathing
    • barginfinder
    • By barginfinder 7th Sep 17, 11:00 PM
    • 325 Posts
    • 83 Thanks
    barginfinder
    • #3
    • 7th Sep 17, 11:00 PM
    • #3
    • 7th Sep 17, 11:00 PM
    worth a punt - just don't put all your eggs in one basket - even a diversified one
    I need a better signature
    • takesyourchances
    • By takesyourchances 7th Sep 17, 11:10 PM
    • 435 Posts
    • 257 Thanks
    takesyourchances
    • #4
    • 7th Sep 17, 11:10 PM
    • #4
    • 7th Sep 17, 11:10 PM
    I topped up a bit as Woodford's fund dropped. I watched the HL video as well this evening with Woodford's interview.

    I am going to take the passive approach with all of this news and ignore the noise around Woodfords fund and keep it in my asset allocation in my UK income section of my portfolio. Not changing anything and lets see what the next lot of years brings with it, that'll be the telling factor in time.
    • darkidoe
    • By darkidoe 8th Sep 17, 1:08 AM
    • 886 Posts
    • 1,007 Thanks
    darkidoe
    • #5
    • 8th Sep 17, 1:08 AM
    • #5
    • 8th Sep 17, 1:08 AM
    I topped up a bit as Woodford's fund dropped. I watched the HL video as well this evening with Woodford's interview.

    I am going to take the passive approach with all of this news and ignore the noise around Woodfords fund and keep it in my asset allocation in my UK income section of my portfolio. Not changing anything and lets see what the next lot of years brings with it, that'll be the telling factor in time.
    Originally posted by takesyourchances
    Sensible. Ignore the news and stick to your asset allocation.

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    • Malthusian
    • By Malthusian 8th Sep 17, 10:41 AM
    • 3,280 Posts
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    Malthusian
    • #6
    • 8th Sep 17, 10:41 AM
    • #6
    • 8th Sep 17, 10:41 AM
    Poor old Woodford. 20 years of beating the index and all the fund pickers say "invest with Woodford, he's the man for the long term". One month of losing his shirt on sub prime doorstep loans and all the fund pickers say "sell Woodford, he's a clown, he's yesterday's man".

    I have no idea what the pre-season rugby analogy was supposed to be about. Mid-life crisis?
    • talexuser
    • By talexuser 8th Sep 17, 11:47 AM
    • 2,283 Posts
    • 1,761 Thanks
    talexuser
    • #7
    • 8th Sep 17, 11:47 AM
    • #7
    • 8th Sep 17, 11:47 AM
    Obviously no one remembers what is was like sticking with him through the tech boom and credit crunch.

    Still, past performance is not an indicator blah blah blah.
    • Audaxer
    • By Audaxer 8th Sep 17, 2:25 PM
    • 559 Posts
    • 244 Thanks
    Audaxer
    • #8
    • 8th Sep 17, 2:25 PM
    • #8
    • 8th Sep 17, 2:25 PM
    This surely strengthens the argument for passive investing, as it seems from this that it is very difficult to choose active funds and managers that consistently beat the market.
    • talexuser
    • By talexuser 9th Sep 17, 11:56 AM
    • 2,283 Posts
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    talexuser
    • #9
    • 9th Sep 17, 11:56 AM
    • #9
    • 9th Sep 17, 11:56 AM
    The point is he's not last years fashionable star manager, he's the last 25 years fashionable star manager. Within that time you can pick out a couple of periods where he underperformed relatively, but came back well ahead of a tracker in the end. The $64000 question is whether he can keep it up in the future, but 33% since launch and then losing 4% does not seem like the end of the world yet.
    • CBaker
    • By CBaker 11th Sep 17, 9:32 AM
    • 38 Posts
    • 50 Thanks
    CBaker
    He has underperformed the benchmark since launch. Don't compare the performance to the FTSE 100 (like a recent article) as its apples to oranges comparison. FTSE 100 performance does not include dividends. Also Woodford as a lot of large positions in illiquid biotech stocks.
    • bowlhead99
    • By bowlhead99 11th Sep 17, 9:56 AM
    • 6,873 Posts
    • 12,378 Thanks
    bowlhead99
    He has underperformed the benchmark since launch.
    Originally posted by CBaker
    Has he? What's a suitable benchmark?
    Don't compare the performance to the FTSE 100 (like a recent article) as its apples to oranges comparison.
    OK, why not compare it to the IA UK equity income sector average for the time his current fund has existed.



    Yeah, looks pretty terrible. Abandon hope all ye who enter here.
    • Glen Clark
    • By Glen Clark 11th Sep 17, 11:05 AM
    • 3,890 Posts
    • 2,890 Thanks
    Glen Clark
    I guess when Woodford/Buffet makes a bad investment - its news.
    Wheras when others make a bad investment - we seldom hear of it.
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
  • jamesd
    http://www.telegraph.co.uk/business/2017/09/06/neil-woodford-right-criticised-sorry/

    Another case for following the passive path and not chasing last year's fashionable star fund manager ?
    Originally posted by Zola.
    This surely strengthens the argument for passive investing, as it seems from this that it is very difficult to choose active funds and managers that consistently beat the market.
    Originally posted by Audaxer
    It's easy:

    When a truly active fund beats an index tracker fans say "it might not continue to happen, buy trackers".
    When a truly active fund does less well than an index, even though trackers always do, they say "trackers beat actives, buy trackers".
    Then there are the times when the active fund beats the relevant index and tracker fans say it's underperformed and you should buy the tracker instead, as in this case.

    The easy bit: active funds aren't trackers. They are supposed to behave differently. But like a stuck clock, whatever time it is, the tracker fan clock is saying buy trackers. All that changes is the news of the day that they can latch on to to say "buy trackers"

    Woodford funds underperformed indexes during the dotcom boom and during the pre financial crisis years because he avoided tech then financials. Worked well. Likely that what he's doing will continue to be good but what it won't do is track an index. If you want a tracker don't buy his funds, his job is to not track an index.
    • Fatbritabroad
    • By Fatbritabroad 11th Sep 17, 1:28 PM
    • 178 Posts
    • 74 Thanks
    Fatbritabroad
    Obviously no one remembers what is was like sticking with him through the tech boom and credit crunch.

    Still, past performance is not an indicator blah blah blah.
    Originally posted by talexuser
    I was going to say it's not like he hasn't been here before I'm not sure why he's apologising he's never been a short term view in any event
    • talexuser
    • By talexuser 11th Sep 17, 2:05 PM
    • 2,283 Posts
    • 1,761 Thanks
    talexuser
    Tracker fans don't like him because he is the living proof that an active manager can beat a tracker in the same general area over a long time.

    The fact that you can't name that many others from all the managers available is the reason for having trackers, but trying to say Woodford did not make you far richer in the long term is frankly ludicrous.
    • NotSkint
    • By NotSkint 11th Sep 17, 3:20 PM
    • 52 Posts
    • 50 Thanks
    NotSkint
    I was going to say it's not like he hasn't been here before I'm not sure why he's apologising he's never been a short term view in any event
    Originally posted by Fatbritabroad
    In this Internet age it is very easy to give "opinions" and there are certainly many negative comments on his own blog.
    Reading such, I do think that there are many that are investing that shouldn't be in the search of return.
    I personally hold some Woodford as part of a diversified portfolio and keep my allocation to his equity income fund at around 10%, whilst having an overall UK allocation of approx 30%.
    His so called "underperformance" has hardly registered, and I took the opportunity to rebalance when the provident share price drop caused a 3ish % drop.
    I think many invest above their risk profile, or hold too short a term view.
    I don't really don't know why he apologised either.
    • Malthusian
    • By Malthusian 11th Sep 17, 4:41 PM
    • 3,280 Posts
    • 4,980 Thanks
    Malthusian
    Because everyone's apologising nowadays. It's the new hip trend. Politicians apologise for not abolishing tuition fees. Paul Hollywood apologises for going to a fancy dress party as General Von Klinkerhoffen 14 years ago. Woodford apologises because his fund's fallen in value.

    Back in þe olden days, people only took offence if you did something to offend them directly, like insult their wife or steal their cattle, and consequently people cared about "losing face" and an apology was a major deal that usually had to be extracted at swordpoint. But now people take offence at absolutely everything, and the currency of apology is degraded along with it. If you do something to upset Twitter you get your PR rep to issue an apology and get on with what you were doing.

    The answer to the question "why did Woodford apologise" is "why not?" It costs him nothing. He could say "I had good reasons to invest in these shares, I believe they'll come good and I apologise for nothing" but it would just get him dropped by even more fund pickers. It's clear they aren't interested in people who have the courage of their convictions or they wouldn't say "Woodford's the man for the long term" one minute and "Sell Woodford, he's underperformed" the next.
    • dividendhero
    • By dividendhero 11th Sep 17, 5:50 PM
    • 102 Posts
    • 83 Thanks
    dividendhero
    One problem with apologising...in today's culture, a string of compo claim often follows
    • Glen Clark
    • By Glen Clark 11th Sep 17, 5:52 PM
    • 3,890 Posts
    • 2,890 Thanks
    Glen Clark
    an active manager can beat a tracker in the same general area over a long time.
    Originally posted by talexuser
    Yes but how do you pick the winning active managers in advance - without the benefit of hindsight?
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
    • george4064
    • By george4064 11th Sep 17, 6:35 PM
    • 856 Posts
    • 903 Thanks
    george4064
    One problem with apologising...in today's culture, a string of compo claim often follows
    Originally posted by dividendhero
    Not gonna happen with all the factsheets/KIIDs/T&Cs investors have to agree to as part of investing into the fund.
    "If you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes” Warren Buffett

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