Woodford’s loyal (and large) following have now lost access to arguably the greatest UK investor of his generation. With the buzz of ISA season and the start of a new tax year just weeks away, it opens the door for other UK equity income funds to flex their marketing muscle.
When Woodford will take on a new retail fund is still in doubt, but by the time he does there’s a fair chance Barnett will be well on the way to shaping Income and High Income to his liking. In practice, it means Barnett has time to sell out of legacy investments he doesn’t like, and buy in to his own new ideas.
Same world view
Of course, having worked together for 17 years, Woodford and Barnett obviously share a similar world view. Seven out of the top 10 holdings in Income are also in UK Strategic Income’s top 10, though you could say the same for many funds in the highly-concentrated UK equity Income Sector.
The point is anybody who has ever met Barnett knows he is very much his own man and he boasts a highly impressive track record in backing his convictions, having consistently beaten his benchmark and achieved first or second quartile status.
Whether or not Barnett will be allowed to – or want to – continue managing the entirety of Invesco’s UK equity income range is open for debate, but it’s about time he was left to get on with his job.
Ducks in a row
“I think the decision came down to the simple fact that Invesco Perpetual has done everything it needs to do and ticked all the boxes,” says Adrian Leacock, senior investment manager at Hargreaves Lansdown.
“They have known for plenty of time now that Woodford was leaving and have had time to get their ducks in a row, draw a line under it and move forward. They have the new manager, and in two years time nobody will remember that they bought the change forward a few weeks.”
