The Woodford contagion effect on Hargreaves Lansdown’s shares has translated into a £150m loss for Nick Train as the platform takes a reputational hit for its endorsement of the stricken fund manager.
Train’s eponymous investment boutique Lindsell Train owns a 11% stake or some 52 million shares in the D2C firm.
Hargreaves has had £1.1bn knocked off its share price in the week since retail investors became trapped in the Woodford Equity Income fund after it was forced to suspend trading due to an increase in redemptions.
Hargreaves shares touched down at a two-month low on Thursday at £19 a share and slipped further on Monday morning before settling back at £19.13.
Other champions of the platform business have also taken a hit. Blackrock, the second largest shareholder, has lost £78m in the last week, while Baillie Gifford, which owns 24 million shares in Hargreaves, is down £69m.
Train has been an ardent believer in Hargreaves, effectively doubling his position in the broker this year. Despite analysts’ concerns that the firm’s valuation looks stretched Train predicts Hargreaves will deliver “explosive growth” when confidence in the economy returns.
The FTSE 100 D2C firm is a staple of Train’s Lindsell Train UK Equity fund, a mirror of the Finsbury Growth & Income Trust, as well as the Lindsell Train Global Equity fund.
On a one-month view Lindsell Train UK Equity has still outperformed the IA UK All Companies sector, returning 0.95% while the sector was down 0.45%. Year-to-date Train’s fund is up 18% while the sector average is around 12%.
Portfolio Adviser reached out to Lindsell Train for comment but did not hear back.
