Disclosure – Non-substantive Research
This is not substantive investment research or a research recommendation, as it does not constitute substantive research or analysis. With this commentary, Kepler Partners LLP does not intend to influence your investment firm's behaviour.
Fund investors are likely feeling besieged. The travails of Woodford are highlighting some of the weaknesses of the “self-advised” market – with accusations swirling as to who is responsible. Retail investors – being non-experts generally – look to fund platforms to provide ideas for their portfolios.
Aside from not being more prescient in not taking Woodford off the recommended list earlier, HL had at least identified the issues and were regularly confronting the manager on them. That he didn’t manage to fix the fund’s liquidity problems was probably because Woodford was already “in too deep”. According to the rules, OEICs must have at least one director. Where the OEIC only has one director, then the sole director must be a corporate with permission from the FCA. In practice, most OEICs will have a sole corporate director, referred to as the authorised corporate director (ACD). Fingers are therefore pointing at Link Asset Services – who, as the ACD of Woodford, is responsible for the governance of the fund.
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