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Neil Woodford has denied he has 'lost it' as the fund manager responded to a series of critical questions from investors following his run of poor performance.
In a series of videos posted on Woodford Investment Management's website, Woodford answered criticism that he spent too much time focusing on early stage companies and faced questions over the overhaul of his flagship fund, the size of his team and future income payments.
It follows the extended interview with the manager published by Woodford Investment Management last week, in which he acknowledged his recent performance had been 'incredibly painful'.
Woodford's flagship £9.8 billion Woodford Equity Income fund is the worst performer in the Investment Association's UK Equity Income sector over 12 months, and the only fund to have made a loss over that period.
His Woodford Income Focus fund has delivered flat returns since its launch in April, while shares in his Woodford Patent Capital (WPCT ) investment trust continue to trade below their 100p issue price more than two years since its launch.
He likened claims he had lost his touch to the criticism he received at the height of the dotcom bubble, when his shunning of tech stocks led to him underperforming peers, before the bubble burst.
'I don’t think I’ve lost it,' he said. 'I’ve been criticised before in my career, in fact those very same words were used about me in late 1999 and early 2000 as a result of the underperformance I was experiencing at that time,' he said.
'I’m sure people are disappointed, as I am, about short-term performance,' he added.
'But this is a long game, I’ve always believed that, and I’m not going to cut and run and run away from the strategy and the investment discipline and the investment principles that I’ve followed for all of my investment life.'
Woodford also faced questions over his investment in early stage companies that form the focus of the Woodford Patient Capital investment trust and make up the tail of the Equity Income fund.
He denied he spent too much time on these companies, to the detriment of attention on the more mature stocks that form the backbone of his Equity Income and Income Focus funds.
Five of Woodford's seven-strong investment team focus on early stage companies, and while he said this represented 'a disproportionate amount of the resource that works with me', he said his own time was not split in the same way.
'I do not spend too much time focused on early stage companies; I have to spend my time looking at my entire investment universe, both the things we’re invested in and indeed the things we’re not invested in and I believe I allocate my time appropriately across that significant workload,' he said.
A pointed question from another investor meanwhile asked: 'Unless you believe you are the master of the universe, what on earth makes a lifelong equity income investor believe they can spot early stage technology companies?'
Woodford said that throughout his career he had always examined all the potential investments he was able to invest in through his funds, and that it was 'absolutely the case that early stage businesses both quoted and unquoted are part of my investment universe'.
'The reason I am invested in them is because I think they will do a fantastic job for our investors over the medium and long term. They are in my view the most undervalued stocks in my entire universe,' he said.
Woodford went on to take a swipe at rival managers who didn't invest in such stocks. 'Most of my peer group don’t, because they don’t bother looking at this part of the stock market,' he said.
Woodford said he expected income payments from the Equity Income fund to grow by 'mid to single digits' this year, despite the impact of Provident Financial (PFG), the fund's fourth largest holding, scrapping its dividend.
The embattled doorstep lender has withdrawn its interim dividend, declared in July and which was due to be paid in November, and said last month a final dividend was 'unlikely'.
'Despite that, the income fund will be paying a dividend increase, I think it will be in the order of low to mid single digits, which is what we said we would do at the start of the year,' said Woodford.
'We were somewhere ahead of that budget before the Provident Financial disappointment, so despite that I’m very confident we will deliver what I said we would deliver in terms of income growth on the income fund.'
Woodford added that the Income Focus fund, which also numbers Provident Financial as a major holding, was 'absolutely on track' to pay 5p income per unit in 2018.
The manager denied that he had changed investment approach since leaving Invesco Perpetual to set up his own firm.
While he made major changes to the Equity Income fund in April, he said 'it’s important for our investors to understand that the approach, if you like, is the same'.
'It is not always the same portfolio that will do the job that we need to do for investors, that works in all economic environments,' he added.
Questioned on the team surrounding him and its ability to keep track of all the firm's investments, Woodford said he had 'the best infrastructure that I have ever had as an investor around me now'.