The Woodford Affair - Poor media coverage

ffacoffipawb

Thrugelmir wrote: »

People shouldn't be investing at all if they have no comprehension of the risk they are exposed to.

.. and the start date of the risk.

SonOf

kinger101 wrote: »

Richard Batchelor has little confidence he will get much of his £2,000 investment back and has accused fund manager Neil Woodford of being 'arrogant and unsympathetic', writes the Daily Mail here.

The former printing company owner, 66, and his wife Kitrina, 67, had about £300,000 in a personal retirement plan, and about £2,000 of this was invested in Equity Income in 2010, on the recommendation of his then-financial adviser.

I can't believe the guy whinging about have £2K of his £300K fund in Woodford. I'm also not sure why his FA thinks it's a good idea for him to have 0.67% investments in anything. I wonder how many funds he holds in total.

The fund didnt exist in 2010. So, that investment date was not possible.

Also, as its a former advised sale in 2010, its not possible to know what the investor has done since then. However, you are right that a piddly £2000 is not something to go to the media about.

kinger101

ffacoffipawb wrote: »

The fund did not exist 9 years ago. WEIF only started on 2 June 2014 so someone is telling porkies here.

Seems the original article was from the Daily Mail. Not surprised by the lack of fact checking.

bigadaj

I don't think anyone would disagree that media coverage is poor, that isn't limited to Woodford or indeed financial services more widely, why print something accurate or true if it's not selling or generating interest.

The problems with Woodford income are that it wasn't operated in a way you would expect an income fund to be, though there is an element of caveat emptor for the investors to take responsibility.

More pointedly is the fee charging when the fund was gated, many costs would still have to be charged but the liquidity issues were partly the function if investing style, and a fund manager profiting when their clients are losing money and can't switch is going to be controversial.

More pointedly wood fords use of unlisted investments beyond his remit appears a serious failing.

This is all a little ironic given that Woodford initially took a lot of criticism for underperformance during the dotcom boom and then came back strongly after.

Thrugelmir

[QUOTE=bigadaj;76668364

This is all a little ironic given that Woodford initially took a lot of criticism for underperformance during the dotcom boom and then came back strongly after.[/QUOTE]

Likewise when the fund topped the performance tables for it's sector post the election. Horses for courses.

[Deleted User]

More pointedly wood fords use of unlisted investments beyond his remit appears a serious failing.

What was the remit?

With the hindsight the problem is obvious:
1. Large proportion of illiquidity
2. Large institutional investors able to withdraw significant sums instantaneously

And looking at some of the bets he was taking, it’s clear the man is a cowboy who didn’t do enough research.

But... Did he actually do anything different from what he had said he would?

Prism

Deleted_User wrote: »

What was the remit?

He had to stay under 10% unquoted but when the redemptions came in he went well over that

fred246

I have a friend who is a journalist. If he is writing a piece like that he will just add a picture of someone he knows, like his girlfriend and say they have lost £xk. They work on the basis that no-one is really bothered about the names and how much they have lost. Plenty of people have lost money so they just put in a photo of a random person with a made up loss.

bigadaj

Deleted_User wrote: »

What was the remit?

With the hindsight the problem is obvious:
1. Large proportion of illiquidity
2. Large institutional investors able to withdraw significant sums instantaneously

And looking at some of the bets he was taking, it’s clear the man is a cowboy who didn’t do enough research.

But... Did he actually do anything different from what he had said he would?

As prism says he was acting well outside of his remit.

And actually well beyond that in the way he invested in unquoted funds was hidden by holding investment vehicles on small exchanges to cover the fact he was massively overweight in illiquid and speculatory investments.

Just to be clear are you criticising the media reporting of Woodford or defending his approach, very different things.

Thrugelmir

Deleted_User wrote: »

What was the remit?

With the hindsight the problem is obvious:
1. Large proportion of illiquidity
2. Large institutional investors able to withdraw significant sums instantaneously

And looking at some of the bets he was taking, it’s clear the man is a cowboy who didn’t do enough research.

But... Did he actually do anything different from what he had said he would?

Topic started to be discussed fully on the savings and investments board a while back. Likewise there was a programme on mainstream television at peak hours. Plenty of indepth coverage in the financial press. Time to move on.