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Investec exploits Woodford exit to up Edinburgh trust stake
Investec Wealth & Investment has added to its stake in Neil Woodford’s Edinburgh Investment Trust while others have been fleeing the fund.
Investec bought another 57,000 shares in the trust yesterday, worth £325,000, meaning it now owns 4% of Edinburgh.
Since it was revealed that Woodford (pictured, left) would be leaving Invesco in April, Edinburgh’s share price has fallen by 5%. This has taken it from a 5% premium to its net asset value at the start of the week to a 1.5% discount today.
Nick Sketch, senior investment director at Investec Wealth & Investment, noted that this had diminished the ‘valuation anomaly’ whereby Edinburgh traded at a premium to Mark Barnett’s Perpetual Income & Growth trust.
Sketch supposed that Barnett (pictured, right) was the most likely candidate to succeed Woodford on the fund, adding that Investec had invested more heavily in Barnett’s trusts even before this week’s events.
Though a replacement for Woodford on the Edinburgh trust has not yet been announced, Citywire AA-rated Barnett is the hot favourite. He will take over control of the £11 billion Invesco Perpetual Income and £14 billion High Income funds ahead of Woodford’s departure.
‘We would be surprised if Barnett taking over was a problem in anybody’s mind,’ said Sketch. ‘And we’d not be surprised at all if Edinburgh’s portfolio doesn’t change in the months until Neil leaves.’
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by Gavin Lumsden on Dec 13, 2013 at 17:09