Woodford Fund

[oldaudi]

Looks like we will need to be more patient with the Woodford Patient fund.

http://www.thetimes.co.uk/tto/business/industries/...

[Ozzie Osmond]

"The fund manager, known for his track record and passion for the biotech sector, has invested about $180 million building a 28 per cent stake in Northwest Biotherapeutics."

What is a "fund" doing owning 28% of anything?

I've avoided his own-named funds (and in part regretted it) simply because of concern that he might start to believe he can walk on water...

[BoRED S2upid]

I'm glad I dodged this one. It sounded a bit too high risk in the first place turns out it's very high risk 55 million is quite a hit.

[trickywoo]

Ozzie Osmond said:

What is a "fund" doing owning 28% of anything?

It won't be 28% in a single fund, rather 28% across all the Woodford funds.

[Ozzie Osmond]

trickywoo said:

It won't be 28% in a single fund, rather 28% across all the Woodford funds.

What is a single fund manager doing owning 28% of anything?

[trickywoo]

Ozzie Osmond said:

What is a single fund manager doing owning 28% of anything?

That's a better question and the answer is along the lines of rolling the dice.

[Ozzie Osmond]

[trickywoo]

Actually I read it wrong. A fund may well hold 28% but the value of this holding won't be more than 10% of the fund value meaning even if the 28% became worthless the value of the fund would 'only' fall by 10% maximum. All else being unchanged.

[nyt]

trickywoo said:

Ozzie Osmond said:

What is a "fund" doing owning 28% of anything?

It won't be 28% in a single fund, rather 28% across all the Woodford funds.

There are only two woodford funds!

[NorthDave]

trickywoo said:

Actually I read it wrong. A fund may well hold 28% but the value of this holding won't be more than 10% of the fund value meaning even if the 28% became worthless the value of the fund would 'only' fall by 10% maximum. All else being unchanged.

I read it as he owned 28% of this company, not that he had 28% of his funds tied up in it.

The fund was up 20% since its start last time I looked.

[trickywoo]

NorthDave said:

I read it as he owned 28% of this company, not that he had 28% of his funds tied up in it.

The fund was up 20% since its start last time I looked.

That's right. My comprehension wasn't.

[jeff m2]

NorthDave said:

trickywoo said:

Actually I read it wrong. A fund may well hold 28% but the value of this holding won't be more than 10% of the fund value meaning even if the 28% became worthless the value of the fund would 'only' fall by 10% maximum. All else being unchanged.

I read it as he owned 28% of this company, not that he had 28% of his funds tied up in it.

The fund was up 20% since its start last time I looked.

Yep, he allegedly owed 28% of a bioteck that got shorted.
But a 155M position in a 800M fund, assuming it was the "Patient fund" seems odd and way beyond fund norms. 5% of the fund is a normal high.
It is also possible that the position cost him less than 155M, and that was the bloated value before the shorts struck.

It is always a good idea to read the fund prospectus before investing, there are usually limitations on what a manager can do, although of course, there could be none!!!! ala hedge fund.
I wouldn't panic shorts nearly always come back and find their true value, I'm surprised he got caught he must have been aware of the short ratio of a holding that size.