Woodford Concerns

arnoldy

There is a nasty smell in the room over the Hargreaves Landsdown Corporate morals and behaviours that NO AMMOUNT of window opening or HL PR air freshener will clear.


It's the relentless plugging of Woodford on their discredited lists whilst simultaneously selling down Woodford in their own MM funds that makes you want to heave.


Like an alcoholic, HL first need to take the brave decision they have a problem with their Corporate behaviours, - and then they can start the process of rehabilitation into civilised society. Which will take years.

Thrugelmir

Sailtheworld wrote: »

Do you mean the KIID?

No. The mandate to the appointed investment managers to run an equity income fund. Unquoted non dividend/income paying investments don't meet this criteria.

ffacoffipawb

iglad wrote: »

You weren't far off the mark with your original post however I shudder to think what's left of your £50k as the longer you have been in the fund the greater the losses. Apparently those who have been with Woodford from the start of the fund are looking at almost 2/3 losses!

The accumulation version is down 15% since inception.

The income version is down 30% but you will have received some income.

Maybe you are confusing WEIF with WPCT?

iglad

ffacoffipawb wrote: »

The accumulation version is down 15% since inception.

The income version is down 30% but you will have received some income.

Maybe you are confusing WEIF with WPCT?

I most certainly did........oops

ffacoffipawb

iglad wrote: »

I most certainly did........oops

Still a crap performance though!!!

arwain

The FCA are looking if institutional investors and retail investors need to be in different funds in the light of what has happened to Woodford after Kent County Council tried to withdraw a lot of money from his fund. More on the story here
https://www.moneyobserver.com/news/fca-retail-and-institutional-investors-may-need-to-be-different-funds

AnotherJoe

arwain wrote: »

The FCA are looking if institutional investors and retail investors need to be in different funds in the light of what has happened to Woodford after Kent County Council tried to withdraw a lot of money from his fund. More on the story here
https://www.moneyobserver.com/news/fca-retail-and-institutional-investors-may-need-to-be-different-funds

I saw that. Classic FCA, address the symptom not the root cause.
The root cause was a fund manager out of control and FCA inadequate action well before a problem arose.
And their so called solution wouldn't fix this anyway, a run on a fund is still possible in their solution
Better regulation on liquidity, naming the exchanges that are allowed to be used rather than loose wording about "recognised exchanges", and an FCA that is much more proactive (just look at their stable door approach to unregulated bonds masquerading as regulated via shonky adverts) might be a good start.

bowlhead99

arwain wrote: »

The FCA are looking if institutional investors and retail investors need to be in different funds in the light of what has happened to Woodford after Kent County Council tried to withdraw a lot of money from his fund. More on the story here
https://www.moneyobserver.com/news/fca-retail-and-institutional-investors-may-need-to-be-different-funds

The article followed the Times's article on Monday after their interview with Bailey. The problem is really the holding of illiquid assets in a fund that allows daily redemptions. Investors - whether a load of individual investors at once, or large institution(s), can demand their money at short notice.

Even if you put institutions in fund A with monthly redemptions on advance notice, and retail investors in fund B with daily or weekly redemptions on advance notice to a cut-off, the problem is not really solved - the manager just gets a bit more breathing space to plan movements in the liquid part of the portfolio, while still potentially being left with a rump of hard to sell assets if redemptions are heavy.

However, having notice periods or less-frequently-than-daily redemptions allowed in a retail fund would be off market standard and wouldn't really fly with retail investors, so the clear solution would be to create a permanent capital vehicle (e.g. closed ended investment trust) and list it on the stock exchange (as per WPCT). But then you won't get fund platforms promoting it and raise billions.

[Deleted User]

AnotherJoe wrote: »

:mad:
For crying out loud, how many times does it have to be stated for it to sink into your skull that HL DO NOT CHARGE TRANSACTION FEES FOR BUYING,SELLING OR TRANSFERRING BETWEEN FUNDS.

At least 20 i reckon, because that's probably how many times you've been informed of that in this thread. Maybe you could count the instances and that would help it percolate past your prejudices ?
I'm out.

If I have been told the above twenty times, then for the 21st time I'll repeat that Hargreaves Lansdown DO charge transaction costs on their funds. To quote them:
"Transaction costs include the explicit costs the manager incurs whilst dealing on behalf of the fund (broker commission, taxes and custodial charges) as well a measure of the fund's trading performance when buying and selling underlying investments."
To be fair, the charges projected are too low to be a big driver of profits for Hargreaves Lansdown; and some contributors say the practice of shuffling one holding between funds would be unlikely or forbidden.
But I do think it is naive to imagine that HL's business model is reliant solely on the fees they charge their clients; anymore than Aapl rely solely on the sale of iphones to generate profit.
The Woodford fiasco illustrates how the interests of Hargreaves Lansdown intertwine with various favoured funds. I don't know in how many funds Woodford is buried beneath a list of "top ten holdings" but, since a quarter of Hargreaves Lansdown customers are affected, if you are one, it may be prudent to check.
"Buyer beware" sure, yet, that Woodford's funds continue to leach fees while their investors watch, only seems like insult on top of misfortune.

Linton

ZingPowZing wrote: »

If I have been told the above twenty times, then for the 21st time I'll repeat that Hargreaves Lansdown DO charge transaction costs on their funds. To quote them:
"Transaction costs include the explicit costs the manager incurs whilst dealing on behalf of the fund (broker commission, taxes and custodial charges) as well a measure of the fund's trading performance when buying and selling underlying investments."
To be fair, the charges projected are too low to be a big driver of profits for Hargreaves Lansdown; and some contributors say the practice of shuffling one holding between funds would be unlikely or forbidden.
......

"Transaction costs" are by definition external costs such as brokers fees, bid/offer spreads, taxes, differences (plus or minus) between market price and actual trading price due to large quantities traded etc. Therefore they cannot be a driver of profits.


The costs incurred by HL themselves are included within the OCF.