PA ANALYSIS: Rivals under pressure as Woodford reveals all (again)

Added 18th May 2017

As Neil Woodford reveals the 50 companies held in his newly launched Income Focus portfolio, it once again throws into the spotlight the rarity with which this level of transparency occurs.

PA ANALYSIS: Rivals under pressure as Woodford reveals all (again)

Notwithstanding the Mifid II call for a quarterly full statement of holdings from next January, the general consensus – from fund buyer and seller sides of the fence – is seemingly that regular disclosure is only a good thing.

So why are we not seeing more groups following suit?

Quite an onerous task, I’m sure and until anything seen as difficult becomes mandatory, it is rarely done. Such is human nature.

As Richard Romer-Lee, managing director at Square Mile Investment Consulting & Research, said: “All regulation is driving towards greater transparency and greater accountability and with transparency comes greater understanding – which is a good thing, surely?”

Currently, regulations require UK funds to disclose their entire portfolios at least twice a year, in the interim and annual reports.

"Fear of peers learning their magic formula, or of clients realising they don’t have one?"

A spokesperson from the Investment Association said: “Investment funds are intended to be long-term investments, with holding periods of at least several years.

“The current regulation achieves a suitable balance between meeting the legitimate expectation of transparency by investors and discouraging short-termism.”

The decision by Woodford though, appears to have been taken irrespective of regulatory pressure, arguably almost a moral position.

When the firm first launched three years ago, with a blank piece of paper, it was a strategic decision to offer full disclosure – in line with the requirements on closed-ended funds as listed entities.

As Craig Newman, chief executive at Woodford Investment Management, said: “We want our clients to understand how their investments are being managed – after all, it’s investors’ money, not ours.

“We took the decision, when we launched three years ago, to publicly disclose our fund portfolios’ entire holdings because it is the right thing to do.”

At the time, it was deemed almost unprecedented in the open-ended space, and yet other groups – both large and small – are keeping their cards close to their chests.

Sponsors

Portfolio Adviser: Guide to Europe

Portfolio Adviser: Guide to Europe

After a politically turbulent time in 2016, Europe has been under scrutiny with several nations going to the polls.The question asked, would investors be right to...

Kames Income Hub

home_research_centre

Vincent McEntegart, manager of the Kames Diversified Monthly Income Fund, explains how he aims to deliver a stable and sustainable income of 5% p.a.*, paid monthly, by investing in a range of asset classes

Square Mile Research

Premier Multi Asset Global Growth - Alex Farlow
Premier Multi Asset Global...

Talking Factsheets is a video service for users...

Visitor's Comments Add your comment

Add Your Comment

We won't publish your address

Profiles

Viewpoint

Investment Strategy

Feature

Tweets

Events

PA Edinburgh 2017
PA Edinburgh 2017

Thursday 7 September
Balmoral Hotel, Edinburgh

PA Alternatives 2017
PA Alternatives 2017

Tuesday 12 September
Radisson Blu Edwardian Bloomsbury Street Hotel

PA Dublin October 2017
PA Dublin October 2017

Tuesday 10 October
Westbury Hotel, Dublin

PA US 2017
PA US 2017

Tuesday 17 October
Furniture Makers' Hall

Sponsored Content

OTHER STORIES FROM LAST WORD...