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Huge inflows raise fears over Woodford’s funds

Invesco Perpetual has allayed adviser concerns about the ever increasing size of Neil Woodford’s income and high-income funds.

The two portfolios, which have over 12bn in assets, took over 1bn in the first quarter alone. High income was the best seller on several fund platforms this Isa season, sparking talk among advisers of a possible future soft close.

An Invesco spokesperson says: “We understand adviser concerns but Neil’s contrarian style allows him to run portfolios of this size efficiently and his interests are aligned with clients. If he were unable to run portfolios at this size, he would be first to let everyone know.”

Hargreaves Lansdown head of research Mark Dampier says: “We trust Neil and are aware his contrarian style enables him to run masses of money but the worry is he is very quickly becoming an asset management arm on his own. The danger for the firm is one fund manager controls too much money which could result in a Fidelity situation all over again.”

Bestinvest research analyst Mark Hinton says: “Advisers should not be too concerned until the funds really start to underperform. Woodford does have to manage money differently as switching a fund of that size can be difficult. He also stopped taking on new segregated mandates.”

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