The revamped Woodford Income Focus (BD9X6V3) is set to reopen in two weeks’ time, fund administrator Link has confirmed.
Under the new management of Aberdeen Standard Investments (ASI), the fund has been suspended since October 2019 and dealing and will recommence dealing under the new name of LF ASI Income Focus.
Investors in the fund will be able to place buy and sell shares in the fund from midday on 12 February onwards, with the fund officially reopening on the following day.
In a letter Link said that since taking over the fund on 31 December ‘ASI has been working to reposition the fund’s investments into a portfolio that ASI considers is best placed to add value for investors with a view to reopening the fund.’
It added: ‘We and ASI have been monitoring progress and we are now of the opinion that the fund’s portfolio is in a position to enable the fund to re-open on 13 February 2020.’
While the details of the restructured portfolio have yet to be released, the biggest clues we can get in terms of how it may look is by examining two other funds run by ASI, namely Murray Income Trust (MUT) and ASI UK Income Equity (B0XWNB4), as revealed in Shares earlier this month.
In the Murray Income Trust for example is pharmaceutical group GlaxoSmithKline (GSK), wealth manager Close Brothers (CBG), life insurer Prudential (PRU) and miner Rio Tinto (RIO) and it currently yields 3.8%. The approach is long-term buy and hold.
Both funds are run by Thomas Moore and Charles Luke, who have taken over running of Income Focus.
The managers are currently reshaping the fund into a concentrated portfolio of around 30 stocks.
They’ve also changed the yield target from a 5p dividend per unit, which had placed the fund on a yield of 7.5%, to a target yield higher than the FTSE All Share over rolling three-year periods.
Ryan Hughes, head of active portfolios at AJ Bell, says: ‘While smaller than the ill-fated Equity Income fund, there is £250m in the fund that will re-open under new management and follow a different investment approach.
‘Investors will now need to consider whether they are happy with the new management of Aberdeen Standard Investments who have said they will operate a more concentrated investment portfolio and a different yield target. This means the fund re-opens with a totally different portfolio to when it suspended.
‘With this news coming soon after the update on the Equity Income fund, the issues that have blighted investors in Woodford’s funds, look to be coming to a welcome close.’