Woodford anyone?

[vulture1]

So what happens if Cathie Woods fund totally bombs? Is this the same thing?

[Royal Jelly]

vulture1 said:

So what happens if Cathie Woods fund totally bombs? Is this the same thing?

Depends what it’s marketed as. Woodford’s was marketed as big, liquid, publicly traded companies, but it morphed into anything but - and there has been shenanigans on the side to make it look like he was obeying that remit..

[megaphone]

Looks like some compensation may be coming. 77p in the £1.

https://www.bbc.co.uk/news/business-65335843

[bitchstewie]

In the circumstances that seems like about 77p more than I was expecting them to get back.

If I was an investor I'd bite their arm off.

[megaphone]

It's not clear to me what the payment will be for. Much of the stock has already been sold at a loss and paid out to investors, so is this just for the remaining amount that is still stuck?

Edited by megaphone on Friday 21st April 08:25

[hidetheelephants]

That's a turn up for the books; I'd written it off, fortunately not an important amount.

[alscar]

megaphone said:

It's not clear to me what the payment will be for. Much of the stock has already been sold at a loss and paid put to investors, so is this just for the remaining amount that is still stuck?

Yes it’s not clear but your assumption seems logical although given as you say a fair amount has already been paid out it doesn’t sound that much in which case maybe your assumption isn’t right ?!
That said doesn’t that compensation work out to be around £800 for each investor which doesn’t sound that much ?

[DonkeyApple]

A good payout, assuming it includes the costs of administration. Bloke was a bloody idiot. Clearly, very smart and very good at what he did given that his investments have recovered that much in a forced seller environment. They were clearly smart allocations. Yet he decided to bend the rules and finished himself, his staff and clients. Silly bellend.

[egomeister]

DonkeyApple said:

A good payout, assuming it includes the costs of administration. Bloke was a bloody idiot. Clearly, very smart and very good at what he did given that his investments have recovered that much in a forced seller environment. They were clearly smart allocations. Yet he decided to bend the rules and finished himself, his staff and clients. Silly bellend.

It's not from fund assets as I read it, but from Link who oversaw the Woodford Funds

[PhilboSE]

DonkeyApple said:

A good payout, assuming it includes the costs of administration. Bloke was a bloody idiot. Clearly, very smart and very good at what he did given that his investments have recovered that much in a forced seller environment. They were clearly smart allocations. Yet he decided to bend the rules and finished himself, his staff and clients. Silly bellend.

He was very good at what he did. When at Fidelity. When he went solo it was an utter stshow and he made very many extremely poor stock picks - many many companies became worthless a few years after he bought in at their peak.

His investments “haven’t recovered in a forced seller environment”. Basically anyone who held Woodford units got some money back for the liquid equities, then got a tiny amount back in a firesale (by Link) of the unlisted equities that had any value. This left all Woodford holders with a rump of a valuation - the unlisted equities that Link can’t sell to the market. Anyone who still held Woodford when it closed still shows a small holding in £ value - basically the valuation of these (now) worthless shares when Woodford bought them.

These investors will now get 77p for the £ showing for this residual lump of their remaining notional Woodford holding. They will NOT be getting 77p in the £ for whatever valuation they had when the Woodford fund closed.

Investors still have to shoulder the loss in value caused by dumping all the liquid equities in the market when the fund closed, and the fire sale of the illiquid stocks.

Woodford and Link and the FCA have all behaved like utter s in this saga.

[DSLiverpool]

I had £5k at the end I’ve £58 now - so I’ll get about £40 ?

[Enut]

PhilboSE said:

DonkeyApple said:

A good payout, assuming it includes the costs of administration. Bloke was a bloody idiot. Clearly, very smart and very good at what he did given that his investments have recovered that much in a forced seller environment. They were clearly smart allocations. Yet he decided to bend the rules and finished himself, his staff and clients. Silly bellend.

He was very good at what he did. When at Fidelity. When he went solo it was an utter stshow and he made very many extremely poor stock picks - many many companies became worthless a few years after he bought in at their peak.

His investments “haven’t recovered in a forced seller environment”. Basically anyone who held Woodford units got some money back for the liquid equities, then got a tiny amount back in a firesale (by Link) of the unlisted equities that had any value. This left all Woodford holders with a rump of a valuation - the unlisted equities that Link can’t sell to the market. Anyone who still held Woodford when it closed still shows a small holding in £ value - basically the valuation of these (now) worthless shares when Woodford bought them.

These investors will now get 77p for the £ showing for this residual lump of their remaining notional Woodford holding. They will NOT be getting 77p in the £ for whatever valuation they had when the Woodford fund closed.

Investors still have to shoulder the loss in value caused by dumping all the liquid equities in the market when the fund closed, and the fire sale of the illiquid stocks.

Woodford and Link and the FCA have all behaved like utter s in this saga.

Was he ever at Fidelity? Invesco Perpetual certainly and I think Eagle Star before that, but I don't think he was ever at Fidelity.

[PhilboSE]

Enut said:

Was he ever at Fidelity? Invesco Perpetual certainly and I think Eagle Star before that, but I don't think he was ever at Fidelity.

Indeed, I stand corrected on that.

[PhilboSE]

DSLiverpool said:

I had £5k at the end I’ve £58 now - so I’ll get about £40 ?

Maybe. Details are a bit sketchy.

One of my kids had a position in Woodford. After the equities were sold (inc. the firesale) this position was valued at £120 - the rump “value” of the illiquid equities that Link couldn’t sell.

However today this is valued at £20.14.

So she might get £92.40 or £15.50 as it’s not yet been stated which valuation will be used for the calculation. Or something else!

[DonkeyApple]

PhilboSE said:

DonkeyApple said:

A good payout, assuming it includes the costs of administration. Bloke was a bloody idiot. Clearly, very smart and very good at what he did given that his investments have recovered that much in a forced seller environment. They were clearly smart allocations. Yet he decided to bend the rules and finished himself, his staff and clients. Silly bellend.

He was very good at what he did. When at Fidelity. When he went solo it was an utter stshow and he made very many extremely poor stock picks - many many companies became worthless a few years after he bought in at their peak.

His investments “haven’t recovered in a forced seller environment”. Basically anyone who held Woodford units got some money back for the liquid equities, then got a tiny amount back in a firesale (by Link) of the unlisted equities that had any value. This left all Woodford holders with a rump of a valuation - the unlisted equities that Link can’t sell to the market. Anyone who still held Woodford when it closed still shows a small holding in £ value - basically the valuation of these (now) worthless shares when Woodford bought them.

These investors will now get 77p for the £ showing for this residual lump of their remaining notional Woodford holding. They will NOT be getting 77p in the £ for whatever valuation they had when the Woodford fund closed.

Investors still have to shoulder the loss in value caused by dumping all the liquid equities in the market when the fund closed, and the fire sale of the illiquid stocks.

Woodford and Link and the FCA have all behaved like utter s in this saga.

That makes more sense. Thanks.

[PhilboSE]

Best figures I can find are that the fund holdings were valued at £3.7Bn when it closed in June 2019. £2.56Bn has already been returned to investors and this final settlement will return another £235M.

So a total of £2.8Bn returned from a valuation of £3.7Bn represents 75p in the £ to investors for the value of the whole fund when it closed.

Or a loss of £900M shared by the 300,000 investors still stuck in the fund when it closed.

[alscar]

PhilboSE said:

He was very good at what he did. When at Fidelity. When he went solo it was an utter stshow and he made very many extremely poor stock picks - many many companies became worthless a few years after he bought in at their peak.

His investments “haven’t recovered in a forced seller environment”. Basically anyone who held Woodford units got some money back for the liquid equities, then got a tiny amount back in a firesale (by Link) of the unlisted equities that had any value. This left all Woodford holders with a rump of a valuation - the unlisted equities that Link can’t sell to the market. Anyone who still held Woodford when it closed still shows a small holding in £ value - basically the valuation of these (now) worthless shares when Woodford bought them.

These investors will now get 77p for the £ showing for this residual lump of their remaining notional Woodford holding. They will NOT be getting 77p in the £ for whatever valuation they had when the Woodford fund closed.

Investors still have to shoulder the loss in value caused by dumping all the liquid equities in the market when the fund closed, and the fire sale of the illiquid stocks.

Woodford and Link and the FCA have all behaved like utter s in this saga.

Thanks for this -makes much more sense now.
Almost incredible to then believe that Woodford had planned on starting up again ?!

[PhilboSE]

Bit more detail trickling out on this. The numbers I reported above appear to be correct but what they’re now saying is that after this last £235M has been returned to investors then they will have had 77p in the £ for their holdings when the fund closed.

So it’s hard at this point to calculate what the final drop will be to investors. As a rough estimate I think if you add the amounts returned on Dec 11 2020 and Nov 11 2022 and double it, you won’t be too far off.

[alscar]

Thanks Phil.
I wonder how many original investors signed up to the various class actions against Link etc - from memory the legal firms were charging 30% iirc on average so presumably that gives them a nice £70m win if everyone signed up ?!

[PhilboSE]

I didn’t sign up on the basis that if they won then the precedent would be set and Link would probably be told to treat all investors the same.

I have read about some people detaching from the action to avoid paying the fees! I suspect Leigh Day will start talking about going after HL now to encourage people to stay enrolled.