Woodford and Hargreaves Lansdown

[KitboyE17]

 I do feel sorry for those people trapped in the Woodford fiasco who had to pay fees whilst the issues were closed. That was just bad form. (Although I suppose the firm had to pay staff and overheads etc. but I doubt to the tune of the several million he raked in during the closure!). 
 

BUT blaming an institution like Hargreaves Lansdown for obviously not doing your own due diligence is your own silly fault. 

Investors caught up in the scandal refuse to lie down quietly

Your savings can go up, or can go down ... Caveat emptor.

[Augustus1]

as a totally amateur investor , I too feel sorry for the people but "you pays your money and you takes your choice" all I would say is "passive passive passive" has worked for me .

dean.m

[vand]

If I had all my money in his funds the ongoing fees would be pretty much the last thing I'd be doing my nut over right now

 

full disclosure: I do have about 2% of my net worth in WIF; however I only started buying just before the suspension and am down about 15% on that position. I sleep very easily at night even knowing I'm going to take a loss on it. Diversification, people. I keep banging on about it.

[Bullionaire]

I would never buy a fund just because HL or any other platform pushed it. 

I had a look through the fidelity select 50 funds - supposedly 50 excellent funds... most were garbage with ~1% fees. Safe to say I stayed away!

I do have some actively managed funds, but lower cost ones like scottish mortgage. 0.4% isn't too bad for an actively managed IT with a great track record

[sovereignsteve]

21 minutes ago, Bullionaire said:

I would never buy a fund just because HL or any other platform pushed it. 

No one needed to push his funds, the guy is/was a legend. He also did really well for the first year or two of starting his own fund company. Whether he lost his touch, needed to take big bets when his funds grew too big or simply the stock matket today isn't the same as it used to be, who knows?

I believe the latter is probably the main reason. Central banks control stock prices now and to be able to beat the crowd is probably impossible.
Also, traditional price discovery is dead now as the number of true stock-picking funds is very small. The vast majority of money is now in tracking funds reliant on where the central banks want to take the prices.

[Bullionaire]

15 minutes ago, sovereignsteve said:

No one needed to push his funds, the guy is/was a legend. He also did really well for the first year or two of starting his own fund company. Whether he lost his touch, needed to take big bets when his funds grew too big or simply the stock matket today isn't the same as it used to be, who knows?

I believe the latter is probably the main reason. Central banks control stock prices now and to be able to beat the crowd is probably impossible.
Also, traditional price discovery is dead now as the number of true stock-picking funds is very small. The vast majority of money is now in tracking funds reliant on where the central banks want to take the prices.

He was a legend, but HL were still pushing his funds right to the end. 

I do not believe price discovery is dead. The global market share of passive funds is ~13% according to Vanguard. Far from the vast majority. There will always be stock pickers/fund managers who are trying to beat the market.

[Stuntman]

I have about 3% of my combined ISA and SIPP savings in that fund, and my holdings are down about 40% versus their peak.  I've just resigned myself to the loss and will move the money into another active UK equity income fund as soon as I'm able to.

[sovereignsteve]

2 hours ago, Bullionaire said:

I do not believe price discovery is dead. The global market share of passive funds is ~13% according to Vanguard

Interesting. I can't remember where I got that information from but it was a wide ranging piece about current stock markets. I'll be on the lookout for it now.

Is your figure number of funds or assets managed? One aspect to consider is that, depending on which metrics you use, probably half the number of funds worldwide are in fact closet trackers, not stock-pickers.

[Bullionaire]

26 minutes ago, sovereignsteve said:

Interesting. I can't remember where I got that information from but it was a wide ranging piece about current stock markets. I'll be on the lookout for it now.

Is your figure number of funds or assets managed? One aspect to consider is that, depending on which metrics you use, probably half the number of funds worldwide are in fact closet trackers, not stock-pickers.

I know there's been a fair bit of fear mongering about a Passive bubble recently. Mainly just because Michael Burry said so. 

I got the value from here: https://www.investmentnews.com/article/20191001/BLOG09/191009998/passive-investing-hasnt-taken-over-the-world "add a reasonable estimate of non-U.S. index funds (about $1 trillion by my estimates) to U.S. passive equity funds, and the total of indexed equity capital rises to about $5.3 trillion worldwide. This puts the passive market share of global equity at about 6.4%. (This excludes a variety of unknown holdings, including sovereign investment funds or separately managed accounts that might be passive. Include those, and global passive might be as high as 13%, according to Vanguard.)"

 

I think passive has exploded in the US over the last decade where over half of the money in funds are now in passive funds, but in other countries, not so much.

As per the pic below, while passive has increased, it's still dwarfed by active managed funds. Even in the US. I see your point about quasi-trackers, but there's not really an easy way to determine how many of these there are.

[vand]

14 hours ago, sovereignsteve said:

No one needed to push his funds, the guy is/was a legend. He also did really well for the first year or two of starting his own fund company. Whether he lost his touch, needed to take big bets when his funds grew too big or simply the stock matket today isn't the same as it used to be, who knows?

I believe the latter is probably the main reason. Central banks control stock prices now and to be able to beat the crowd is probably impossible.
Also, traditional price discovery is dead now as the number of true stock-picking funds is very small. The vast majority of money is now in tracking funds reliant on where the central banks want to take the prices.

He definitely changed his investing style, tilting much more towards smaller, riskier, and less liquid stocks. 

The problems then manifested when a few of his holding (eg PGF) started having problems and he just had to keep selling to order to meet redemptions.

It's worth recognising that in today's world of passive investing and ETFs we are likely to get a similar thing happening on a much larger scale as everyone rushes for the exit door in the next downturn.. be prepared!

 

As for HL, I've never taken notice of anything any platform has "recommended". They have no more expertise in this area that you or I. 

People want to be told what to do, instead of doing the work for themselves. That way they have an easy excuse when things go wrong. If its your money.. you should accept full responsibility for it.

[5huggy]

1 hour ago, vand said:

People want to be told what to do, instead of doing the work for themselves. That way they have an easy excuse when things go wrong. If its your money.. you should accept full responsibility for it.

So damn right! 👍