THE MONEY MAKING EXPERT

‘ongoing’ charge which is meant to sweep up all costs into one percentage figure, the figures are not consistent across the industry. The result is that investors are often comparing apples with pears.

Finally, as Wealth highlighted recently, many investment houses are reluctant to reveal to investors

mounts

Unfortunately, irreparable damage now appears to have been done to his name.’

Peter Watson believes the relationship between Hargreaves Lansdown and Neil Woodford highlights a problem within the investment industry. The 73-yearold retired banking manager says: ‘Mark Dampier appears to have been beguiled by Woodford.’

Peter, from Sherborne in Dorset, invests in Invesco Income Growth, an investment trust Dampier was made a non-executive director of three years ago. Peter adds: ‘If Dampier is such an expert why could he not have spotted any problems with Woodford earlier?’ any information on fund holdings other than the top 10 positions (Woodford is one of the few honourable exceptions). This prevents curious investors from looking through an upto-date portfolio to see whether its contents reflect the fund’s label. Wealth manager SCM Direct, run by former fund manager Alan Miller and antiBrexit campaigner Gina Miller, has long campaigned for a fairer and more transparent investment industry.

In the wake of the Woodford ‘scandal’, it has called again for an end to the ‘dismal treatment of fund investors’ and published a five-point plan urging a mix of regulatory and Government intervention.

We agree. Opposite, we list what we believe the key players – fund managers and investment platforms – need to do as a matter of urgency to win back the trust of investors.

We also have some advice for Woodford, still refusing to waive fees on suspended fund Equity Income, and Hargreaves Lansdown that promoted Woodford right up until dealings in the fund were stopped.

As for the four funds I asked you the two questions about at the start, they are all managed by powerhouse Invesco. Their respective yields – income paid over the past year, expressed as a percentage of the fund’s current unit price – are 3.63 per cent (UK Strategic Income), 3.65 per cent (High Income), 3.68 per cent (Income) and 3.86 per cent (Income & Growth).

Only one – Income & Growth – meets the criteria laid down by the fund industry’s trade association to be identified as a proper UK equity income fund.

Despite their income titles, the other three fail by virtue of their lower yields and are classified by ‘UK all companies’ funds.

It seems a case of fund mislabelling although Invesco argues otherwise, insisting it continually reviews all its promotional material to ensure fund objectives and investment policies are clearly described.

Phil Case, a former fund manager, says it is confusing for investors to be presented with so many Invesco funds with similar investment mandates.

He also says it ‘just doesn’t make sense’ to have an Income & Growth fund sitting in a UK equity income sector while a High Income fund sits outside.

His view? ‘A fund’s title should reflect what lies under its bonnet.’ Wealth couldn’t agree more.