Woodford dilemma

The closure of the Woodford Equity Income Fund (WEIF) could leave investors waiting for their money for “years”, with the affair likely to have ramifications for the Authorised Corporate Director (ACD) market and regulators’ future approach to fund liquidity standards, according to industry commentators.  Investors are likely to see some capital more quickly from the sale of the fund’s liquid assets, but the fund’s illiquid assets – to which it has high exposure – will take much longer to liquidate.

The same will apply to all investors regardless of size, with Kent County Council’s intention to withdraw £250m – which reportedly led to the WEIF’s June gating – to be paid back at the same pace as every other investor.  The potential downside is that investors will end up waiting longer, but the upside is they will probably get a better price.”

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