Unfair column inches

06 Jun, 2019

It is rare that asset management makes the front pages and invariably it seems to be when things go wrong. I find it massively depressing watching the news about Woodford and the suspension of his Equity Income fund. It will only do damage to the industry and act as further confirmation of the fears that the vast majority of the UK population have of investing.

Day-in day-out asset managers invest and manage billions on behalf of those with the confidence to trust fund houses and make good returns by doing so. That never goes reported and so the column inches unfairly tarnish the reputation of the industry.

The truth is, those who suffer most are those who continue to leave their savings in cash or low interest ISAs due to the disproportionate worry that events like this instil in them. I know that the cult of personality around Woodford made an outright swing in the opposite direction somewhat inevitable. There is nothing the press likes better than to raise someone up and then watch them fall.

This is where brands distinct from the people in the business matter. It provides insulation and protection. A brand called Woodford run by Woodford can’t very well remove Woodford from the equation. If we’re honest with ourselves the business has been struggling for a while and that has been exacerbated by the simple news narrative that having a single figurehead has enabled. It allowed the rocket-like rise but also enabled the meteorite-like fall. I’m not saying a brand would have been immune from the difficulties the funds have faced but I do believe they would have had more levers to pull in reducing the impact.