More patience needed: Woodford investors saw stock picker’s former flagship investment trust drop another 29% last year
Investors in the former Woodford Patient Capital Trust are still suffering as the chairman admitted that performance was “disappointing” over the past year.
Savers suffered heavy losses after some of the companies selected by fund manager Neil Woodford failed to generate returns.
Although Woodford was ousted as a manager in 2019 due to the collapse of his investment empire, the value of the fund’s assets fell another 29.2 percent compared to 2020, the annual report revealed yesterday.
The savers of the former Woodford Patient Capital Trust suffered heavy losses after some of the companies selected by fund manager Neil Woodford failed to generate returns
Blue-blooded investment firm Schroders was named Woodford’s successor in December 2019 and has since attempted to reverse the performance of the newly renamed Schroder UK Public Private Trust.
In the annual report, Chair Susan Searle, who faced resignation in 2019 on criticism that she should have acted earlier to fire Woodford, said: “The December 31, 2020 assessment is clearly disappointing.”
To bolster investor sentiment, she added, “We believe the company is in a much better position now than it was a year ago.”
Schroders had tried to pay off the trust’s mountain of debt. Loans can increase investor returns when performance is good, but it increases losses.
While it did manage to reduce debt, confidence was still hurt by the poor stock performance that Woodford left behind.
Cancer treatment company Rutherford Health was the single largest burden as its value was downgraded by £ 47 million during 2020 due to slow progress in the business.
The value of Atom Bank, Benevolent AI and the experimental nuclear fusion company Industrial Heat have been cut by more than £ 5 million.
Unlike the doomed Woodford Equity Income Fund, the Schroders Trust is listed.
This means investors can sell the stocks they hold at any time – but that would likely mean a big loss as stocks are at an all-time low of 32p.