FTSE 100: 7364.56 ▼ -60.84 (-0.82%)
Citywire A-rated Neil Woodford has raised £553 million for his higher-yielding Income Focus fund.
The fundraising makes the Income Focus fund one of the UK's most popular fund launches, although the amount raised is below the £1.6 billion the Woodford Equity Income fund gathered at launch, or the £800 million for the Woodford Patient Capital (WPCT) investment trust.
The new fund is targeting a dividend of 5p per unit in its first full calendar year in 2018, having launched at 100p and will invest in a portfolio of around 55 stocks. As with his other funds, Woodford intends to publish the names of all the stocks in the portfolio once the first factsheet is published.
'I am very excited by the income prospects of the companies within the portfolio,' said Woodford. 'In a low interest world, an income-focused equity portfolio is an attractive proposition for investors, while the lack of geographic restraints allows me to access quality income stocks regardless of their location.'
The inflows lift total assets under management at Woodford Investment Management to £17 billion.
'After speaking to private investors, intermediaries and platforms last year, we knew there was an appetite for a new equity fund targeting a higher income,' Woodford Investment Management chief executive Craig Newman said.
'Aligned with Neil’s outlook for the investment opportunity, the fantastic response highlights investors’ continued interest and requirement for high quality income streams in today’s economic environment.'
Laith Khalaf, senior analyst at online stockbroker Hargreaves Lansdown, said: 'Neil Woodford's new offering has proved a hit with investors, which isn't too surprising given his pedigree, low management charges, and the fund's focus on a higher income.
'The new fund hasn't raised as much as the first offering launched by Woodford Investment Management, but the new fund targets a more specific audience, and this time around there isn't the boost from some investors from his previous Invesco Perpetual funds following him to his new venture.'