Top stockpicker Neil Woodford suspends flagship fund
One of the UK’s most high profile stockpickers has suspended trading in his largest fund as rising numbers of investors ask for their money back.
Neil Woodford said after “an increased level of redemptions”, investors would not be allowed to “redeem, purchase or transfer shares” in the fund.
Investors have withdrawn about £560m from the fund over the past four weeks.
However, it was a request from Kent County Council to withdraw £250m that led to the suspension.
The council was unavailable for comment.
A stockpicker analyses the potential of different stocks to try to decide whether or not they will make a good investment.
At its peak, the Woodford Equity Income fund managed £10.2bn worth of assets, such as local authority pension funds.
However, it now manages £3.7bn, according to the financial services and research firm Morningstar.
Mr Woodford’s firm, Woodford Investment Management, is also the biggest investor in Kier Group, the construction and services group which on Monday warned on profits, sending its shares crashing 41%.
It is understood that the fall in Kier’s share price is not connected to the decision to suspend trading in the Woodford Equity Income fund.
The firm said the suspension would give it “time to reposition the element of the fund’s portfolio invested in unquoted and less liquid stocks, in to more liquid investments”.
The Financial Conduct Authority, the city watchdog, said: “The FCA is aware of this situation and in contact with the firms involved to ensure that actions undertaken are in the best interests of all the fund’s investors.”
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Mr Woodford launched his own fund five years ago this month, with its corporate headquarters in Oxford.
In its first year, it gave investors a return of 18% on their money, compared with an average rise of only 2% on the London Stock Exchange at the time.
However, after the figures were released he warned: “It’s far too early to conclude that the fund’s strategy has worked.”
Before that, the 59-year-old had worked as part of the UK equities team at investment managers Invesco Perpetual for more than 26 years.
He was appointed a CBE for his services to the economy in 2013.