The Lemon Fool

OhNoNotimAgain wrote:The other ones you quote are, at best, neutral or favour ETFs which are more complex than OEICs

Change the goal posts why don't you. 2 of them don't even use active funds at all. You seem to have one specific things you don't like and from that extrapolated that the whole world's is against you. Rather cynical. You'll be fine. Don't worry, there's plenty of people on your side.

So the launch period closes at 12pm tomorrow (12th April), is there any technical reasons whether I should invest before or after? Not a big OEIC/UT investor so I'm now wondering how pricing is settled at £1 when presumably underlying assets are being bought or optioned from the launch date of March 20th - who bears that cost? Is there some fudging based on fair value pricing?

MusingMarket wrote:So the launch period closes at 12pm tomorrow (12th April), is there any technical reasons whether I should invest before or after? Not a big OEIC/UT investor so I'm now wondering how pricing is settled at £1 when presumably underlying assets are being bought or optioned from the launch date of March 20th - who bears that cost? Is there some fudging based on fair value pricing?

That's fairly simple to explain. They can set the initial price at whatever they want. They have received £1 for each share, and presumably were investing pro-rata to the funds which they had. If the underlying investments had increased substantially, then the first time they publish the NAV that will affect how the market views the shares, and they may move to a discount or premium. They could well be holding a lot of cash.

TJH

tjh290633 wrote:

MusingMarket wrote:So the launch period closes at 12pm tomorrow (12th April), is there any technical reasons whether I should invest before or after? Not a big OEIC/UT investor so I'm now wondering how pricing is settled at £1 when presumably underlying assets are being bought or optioned from the launch date of March 20th - who bears that cost? Is there some fudging based on fair value pricing?

That's fairly simple to explain. They can set the initial price at whatever they want. They have received £1 for each share, and presumably were investing pro-rata to the funds which they had. If the underlying investments had increased substantially, then the first time they publish the NAV that will affect how the market views the shares, and they may move to a discount or premium. They could well be holding a lot of cash.

TJH

Don't OEICS trade at NAV? This fund is an OEIC and not an investment trust. I think.

Bialystock wrote:Don't OEICS trade at NAV? This fund is an OEIC and not an investment trust. I think.

Yup.

Digging up the Woodford Income Focus prospectus page 32 states:

No subscription monies will be invested during the initial offer period. Investors will only become
exposed to market movements once investment has occurred. No interest will accrue on the
subscription monies during the initial offer period. The ACD will commence investment activities
following the end of the initial offer period. Any subscriptions received after the close of the
initial offer period will be processed on the next Dealing Day and Shares will be issued at the price
determined on the Dealing Day on which they are issued.

Though this doesn't explain prior paragraphs that suggest there could be an issue if prices moved during the offer period:

The ACD reserves the right to alter the offer period and launch date of a Fund where deemed in the
interests of subscribers.

The initial offer period may come to an end if the ACD believes the price that would reflect the
current value of the CF Woodford Income Focus Fund would vary by more than 2% from the initial
price.

This is rather academic querying on my part but I'm a little surprised by the idea they'd start buying on a specific day. Given the certainty of Woodford buying Glaxo, AstraZeneca, BAT and Imperial that's a lot of demand which traders on the other side of the trade could take advantage of.

These data are no longer current.

Rob

OhNoNotimAgain wrote:These data are no longer current.

Invesco Perpetual Global Financial Capital is still the highest yielding fund in the IA Specialist sector, which is the sector that the Woodford Income Focus fund is in.

mc2fool wrote:

OhNoNotimAgain wrote:These data are no longer current.

Invesco Perpetual Global Financial Capital is still the highest yielding fund in the IA Specialist sector, which is the sector that the Woodford Income Focus fund is in.

With 58% in corporate bonds it is hardly in the same asset class as the new fund which will be benchmarked to the FT All Share Index so presumably be largely invested in UK equities. In which case the appropriate sector is the UK All Companies Sector. The fact that it is not in there suggests he wants to play outside the sector.



Rob

OhNoNotimAgain wrote:...presumably be largely invested in UK equities. In which case the appropriate sector is the UK All Companies Sector. The fact that it is not in there suggests he wants to play outside the sector.

It's not a "suggestion" that he wants to, as you put it, "play" outside of UK All Companies -- it's explicit he's likely to. As has already been highlighted in this thread, their own website says, "Geographic exposure: No restrictions".

Honestly, Rob, when funds/ITs that are in a UK sector (all cos, eq inc, etc) invest a little of their portfolios outside of the UK you cry foul and say they shouldn't be in a UK sector.

Yet now with Woodford's fund, which is going to be largely but not wholly invested in UK equities and has put itself in a non-UK sector 'cos it is likely to also invest outside of the UK, you're complaining it isn't in a UK sector!

Well, you are right: the Woodford Income Focus fund isn't in UK All Companies because it'll be investing outside of that sector.

mc2fool wrote:

OhNoNotimAgain wrote:...

Well, you are right: the Woodford Income Focus fund isn't in UK All Companies because it'll be investing outside of that sector.

But he wants to be benchmarked to the FTA?

It must just be me that seems to find this twisting of benchmarks and investment universes disateful. If this fund can invest anywhwere in the world in anything it likes using a benchmark that only contains equities listed on the UK stock exchange must surely be misleading?

Rob