Hargreaves Lansdown shakes up its best buy funds list in wake of the Neil Woodford debacle
Hargreaves Lansdown will publish its updated list of recommended funds today as it tries to repair its image following the Neil Woodford debacle.
The Wealth Shortlist will replace the investment platform’s Wealth 50 list, which fell into disrepute for recommending the doomed Woodford Equity Income Fund right up until the fund’s suspension last year, with investors losing at least 27 per cent of their savings.
The updated shortlist will contain 68 funds and Hargreaves said it has ‘listened and learned and taken action’ when selecting them.
Hargreaves Lansdown’s new Wealth Shortlist will replace the investment platform’s Wealth 50 list, which fell into disrepute for recommending the doomed Woodford Equity Income Fund
It has improved its selection criteria, introduced further risk monitoring, improved its governance procedures and will include more guidance on how a fund could fit into an investor’s portfolio.
When the Woodford Equity Income fund collapsed last year, Hargreaves was accused of favouring funds which offered its customers access to a cheaper share class.
This meant Hargreaves could ramp up its own fees which it charged to customers, while keeping the overall fee similar to its rivals.
Hargreaves denied it took its economic interests into account when compiling the Wealth 50 list, but agreed to reassess its selection criteria. The new shortlist will include 17 funds which were not on the old list.
But fund manager Terry Smith, whose Fundsmith Equity vehicle has been one of the best performers since it launched in 2010, will still not appear on the list.
Hargreaves said they wanted monthly updates, whereas Fundsmith prefer to provide data on a six-month basis.