The legendary fund manager Neil Woodford yesterday revealed he is leaving Invesco Perpetual – the investment firm he’s been at for more than a quarter of a century.
The equity income guru, who looks after around £33bn-worth of UK savings, said he plans to start his own fund management business next April.
Despite chatter that the fund manager had become disenchanted with his role at Invesco, both Mr Woodford and the Henley-based fund management firm were keen to stress the split is amicable. Mr Woodford said: “My decision is personal, based on my views on where I see long-term opportunities in the fund management industry.”
Mr Woodford will remain responsible for the funds for which he is the named manager for the next six months before handing over the reins to Mark Barnett, who has been at Invesco himself for 17 years.
His departure will be a major blow to Invesco as he runs around half of their funds under management, including the flagship £14bn High Income fund and the £10bn Perpetual Income fund.
Martin Bamford, of financial adviser Informed Choice warned: “This is potentially devastating for Invesco. Investors love Neil.”
His returns to investors have been impressive – any that invested £1,000 into his High Income fund at launch in 1988 would now be sitting on £22,919.51. A similar amount invested in the FTSE All Share would be worth just £10,254.66.
His fans also enjoy Mr Woodford’s outspoken intervention as an active investor. As the largest shareholder in BAE, for instance, his negative reaction to the proposed takeover of the company by its Franco-German rival EADS last year was instrumental in it being called off.
His investment style is to pile into defensive blue-chip UK companies producing stable long-term dividends. He also correctly refused to buy into the technology bubble at the turn of the last century.
He advocates long-term investment and pressurises executives of companies he invests in. Last year he said: “I am an exception in the industry. I take corporate engagement very seriously. The industry, I believe, is failing on this point.”