Revamped Woodford Income Focus Portfolio Revealed

Aberdeen Standard reveals new top holdings and investment approach for Woodford Income Focus fund, and the difficulties dealing with Woodford legacy stocks

James Gard 12 February, 2020 | 12:41AM
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The former Woodford Income Focus is set to re-open on Thursday under new management after a four month period when investors have been unable to buy or sell their holdings.

Aberdeen Standard, which has taken over the running of the £253 million fund, has now laid out its new investment principles, revealed its top 10 holdings and fee structure.

Launched in April 2017, the fund was originally run by Neil Woodford and remained open even after the much larger Woodford Equity Income gated in June. In October 2019, Woodford confirmed the Equity Income fund would be wound-down, while the smaller Income Focus fund would be suspended and passed to a new manager. 

Since then, the portfolio has undergone a serious revamp. Aberdeen Standard's Thomas Moore and Charles Luke, who now manage the fund, will aim to hold between 30 and 40 “best idea” stocks. These are companies they expect to beat the index over three years and to have a yield higher than the FTSE All-share average over the same time period.

Long-distance bus company National Express (NEX) is the top holding in the fund, accounting for 3.77% of assets. Each of the top 10 holdings has a weighting of between 3 and 4% in the fund, reflecting the managers' high conviction in their choices. Income giants British American Tobacco (BATS) and National Grid (NG.) also feature among the top 10 holdings.

It's a significant change from the shape of the porfolio as Woodford stepped down from the helm. His last position was in real estate investment trust New River REIT, with 7.28% invested in the stock. Property featured heavily in the portfolio, with housebuilders Taylor Wimpey, Crest Nicholson and Barratt all featuring in the top 10. Meanwhile, doorstep lenders Provident Financial and Morses Club, and loan provider Amigo each accounted for more than 3% of assets. 


Top 10 Holdings - Woodford Income Focus

% of Portfolio

Top 10 Holdings - ASI Income Focus

% of Portfolio


(October 2019)


(February 2020)



New River REIT


National Express



Barratt Developments







John Laing Group



Provident Financial


British American Tobacco



Taylor Wimpey





Amigo Holdings


Close Brothers





Onesaving Bank



Crest Nicholson





Imperial Brands


Babcock International



Morses Club


National Grid



Source: Morningstar Direct/Aberdeen Standard


Legacy Issues

Aberdeen Standard has revealed the difficulties faced by the new managers in dealing with some of the Woodford legacy stocks – it highlighted the case of Honeycomb Investment Trust, which made up over 3% of Woodford Income Focus but has now been offloaded, as a particular drag on the fund’s performance.

“We recognise that investors in the Income Focus Fund have endured some frustration over recent months. Looking into 2020 and beyond, I believe the prospects are significantly brighter,” says head of equities Andrew Millington. He adds that many investors are taking a fresh look at the UK equity market. Indeed, inflows into the UK stock market and UK funds have increased since the General Election, according to Morningstar Direct data.

But FundExpert’s Brian Dennehy urges caution: “There are plenty of good and proven funds out there – no one needs to take a risk on this until a track record is established.”

Indeed, many investors who have been locked into the fund for months will be wondering what to do now they can access their money again. Adrian Lowcock, head of personal investing at Willis Owen, says: "Looking at the top holdings in the new fund, it doesn't have the look and feel of a core equity income portfolio and investors will need to consider if it is right for them. There are plenty of alternatives to choose from with strong track records." 

Delving into the Detail

Aberdeen Standard, authorised corporate director Link Fund Solutions and depository Northern Trust are all waiving their fees until the end of May 2020. The fund lost 7.3% in 2019, 26% below the benchmark, the FTSE All-Share, fell 20.7% in 2018 – and is down 6.7% so far this year – according to Morningstar data.

Income Focus is a much smaller fund than the flagship Woodford Equity Income, which is being wound up. The first capital repayment from the Equity Income fund was made in January to investors, although this has been made from the more liquid assets of the portfolio. Those holding the Z Sterling Accumulation share class of the fund got the highest repayment, at 58.99p per share. There are concerns though that the less liquid stocks, including unquoted companies, will be much harder to sell.

ASI Income Focus Fund managers Thomas Moore and Charles Luke run a number of funds rated by Morningstar: Moore manages the Bronze-rated ASI UK Income Unconstrained Equity fund and Aberdeen Standard Equity Income Trust (ASEI) and Luke runs the Neutral-rated Murray Income Trust (MUT) and ASI Income Equity fund.

Meanwhile, the closed-end offering from Woodford Investment Management, the Patient Capital Trust has been taken over by Schroders and renamed the Schroder UK Public Private Trust (SUPP). The trust sits at a discount of 43%, according to Morningstar data, and its share price has fallen 64% in a year.


The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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James Gard

James Gard  is senior editor for


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