Argyle News : Phil's Blog (January 2008 Archive)

Sometimes topical issues can arise which demand an immediate and un-scheduled response. Phil’s blog will discuss these issues in an open and down-to-earth manner.

23/01/08

Quality vs Quantity

Do Fund Management houses take us all for mugs? I ask that question in all seriousness as I flick through the trade press and weekend press this morning. There seems to be a competition amongst fund management firms to launch as many funds as possible at the moment.

News broke over the weekend that Schroders are planning to launch a UK Property fund to exploit the recent downturn in commercial property. How very good of them - isn't there enough negativity about Property at the moment without one of the leading UK fund managers seeking to exploit this? Especially from a company that isn't even managing a UK Commercial Property Trust! You would have thought that Schroders would be more interested in turning around their UK 250 fund from its recent downward spiral?

Schroders are not the only ones - last year everyone one seemed to be launching a Climate Change/Environmental/Green theme fund and now this year it looks to be Emerging Markets fund. Is this due to investor demand or is it a trick to try and divert our attention away from some of their poorly performing funds? How many people will pile into these funds and be left there in a state of joint apathy - when both the investor and the fund manager take their eyes off the fund to focus on the new hot topic of the day?

07/01/08

Happy New Year to you all

Did you know that the average UK person will this year have a greater income than their US counterpart for the first time since the 19th Century? Analyst Oxford Economics said the UK's GDP per head of population will reach £23,500 - £250 higher than in the US. However, because goods and services are cheaper in the US, Americans will have stronger purchasing power. UK GDP per capita will also be higher than in Germany (£21,665) and France (£21,700), Oxford Economics calculated. The questions in my mind are, compared to this, how much debt per head does the UK have and what would the picture look like with these revised figures included?

Finally, it has been announced that Fidelity are no longer the largest UK fund management firm. That honour goes to Invesco Perpetual. Much of Invesco's rise can be put down to income guru Neil Woodford's flagship higher income and income funds - which are on our funds panel. The scary thing about the Invesco situation is that Woodford now manages £18.3 billion, which represents nearly 60% of Invesco's total funds under management. That is a hell of a lot of money for one man to be responsible for. From the outside it looks as if the future Invesco Perpetual business model is unevenly balanced and reliant on one individual. Something for us to keep our eye on in 2008.