Woodford Concerns
Comments
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It seems like a no brainer to me to get out.
It isn't. If you think that Woodford is a genius who will eventually be proven right (as he was almost 20 years ago), and are comfortable with the risk associated with the high allocation to unlisted equities (including the risk of wind up), then what is happening now should be expected. Even star managers underperform at times. However it doesn't sound like you do or are.
Probably that it's still in Hargreaves Lansdowns' buy list therefore it must be terrific.What are the other people thinking that make up the 4 billion already invested?
Depends exactly what you mean by "what is happening". Star managers running out of luck is commonplace. The exact manner in which he's run out of luck, the scenario with the excessive allocation to unlisted equities, is more unusual.Is what is happening to Woodford and his fund considered exceptional?0 -
I'm of the view that I like to have some idea what I'm investing in.
Looking at what Woodford Equity Income holds I haven't heard of most of it.0 -
Neil Woodford looks like a wheeler-dealer kind of guy. Looks like a guy you'll meet during a dodgy deal.0
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Being naive and when the good times were rolling I put off diversifying at a cost of course.
Wrong way to construct a portfolio. Diversification is key.I am completely happy to wait for a fund to recover and sit through bad times but with this it doesn't quite seem to be as simple as that
Never be afraid to cut your losses. Better to run your winners.the two Lindsell funds are obviously performing well and invest in well established companies.
Never chase performance. Fund managers have no control over the financial performance of companies they invest in. There's no god given right to be successful. Hindsight is a great tool for investors too. All investors make mistakes. The aim should be for your portfolio as a whole to make a gain every year. Some holdings will show a profit some a loss. The only figure that matters is the net one.
Suggest you start scaling back the investment in your sole holding and research some alternatives.0 -
You invested in Woodford because it performed well in the past and that hasn't worked so now you're going to invest in Lindsell because it has performed well in the past. I would politely suggest there's not much learning from mistakes going on here.0
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You invested in Woodford because it performed well in the past and that hasn't worked so now you're going to invest in Lindsell because it has performed well in the past. I would politely suggest there's not much learning from mistakes going on here.
Please read the thread. I didn't say I invested in Woodford due to his past performance.
My mistake was to not diversifying and also not cutting my losses earlier.
I agree with you that past performance isn't an indicator of future returns but surely you don't pick funds that have a donkey at the helm that haven't performed for years. Past performance plays some part surely.0 -
Thrugelmir wrote: »Wrong way to construct a portfolio. Diversification is key.
Never be afraid to cut your losses. Better to run your winners.
Never chase performance. Fund managers have no control over the financial performance of companies they invest in. There's no god given right to be successful. Hindsight is a great tool for investors too. All investors make mistakes. The aim should be for your portfolio as a whole to make a gain every year. Some holdings will show a profit some a loss. The only figure that matters is the net one.
Suggest you start scaling back the investment in your sole holding and research some alternatives.
Thanks for your constructive post. Unfortunately I thought the good times would carry on and when he was up I didn't envisage it falling this much.
I'm doing as much learning as I can and I suppose I could keep my ISA as cash until I am better informed.0 -
I agree with you that past performance isn't an indicator of future returns but surely you don't pick funds that have a donkey at the helm that haven't performed for years. Past performance plays some part surely.
Unquoted investments or early stage companies can take a long time to come to fruition. Pointless comparing directly to market indices. As not a comparable measurement. Illiquid investments are best held in a closed fund such as an Investment Trust. Then the fund manager is sheltered from having to liquidate the portfolio to meet redemptions.0 -
Thrugelmir wrote: ». The aim should be for your portfolio as a whole to make a gain every year. Some holdings will show a profit some a loss. The only figure that matters is the net one.
I agree with most of what you say except for this bit. I don't think it matters at all about making a gain each year (calendar year, tax year, rolling 12 months?) for everybody. I you are looking to withdraw income or capital then its more important, but for those investing for their future it should have no real bearing. Only the long term results should matter. I mean, don't get me wrong, you can learn a lot during the difficult times but I wouldn't let a single year get in the way of my goals.0
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