Short positions... pay-out for Woodford investors

⬛ The Financial Conduct Authority (FCA) has confirmed that more than 300,000 investors who were trapped in Neil Woodford’s flagship Equity Income Fund when it collapsed in 2019 will receive compensation from Link Fund Solutions (LFS), the fund’s former administrator. LFS has agreed to make £235m in redress payments to Woodford investors after the regulator found it had failed to manage the fund’s liquidity. The star fund-manager’s empire collapsed after investors lost confidence in his investments in illiquid, early-stage private businesses. More than £2.5bn has been returned to investors from the sale of the fund’s assets so far. While the settlement is welcome, the FCA estimates investors are owed £298m overall, meaning investors are receiving just 77p for every £1 trapped. Still, the FCA argues that the proposed repayment “offers investors the best chance to obtain a better outcome than might be achieved by any other means”. ⬛ The FTSE 100 index outperformed global markets last year thanks to its heavy weighting of resource stocks, but even this performance hasn’t convinced international investors the UK is a great place to invest. Some 21% of global investors say they are underweight UK equities, up from 6% last month, according to Bank of America’s latest global fund manager survey. Meanwhile, data from The Investment Association (IA) shows that outflows from funds in the UK all-companies sector hit £1.25bn in both January and February, versus £800m per month on average over the past 12 months. Troy’s Trojan Income fund suffered some of the largest outflows, shedding £434m of assets in the first quarter. It ended March with £1.2bn of assets under management, down from £2.7bn at the start of 2022.