Wednesday, 18 November 2015

The Maestro's Movers: Neil Woodford's Big Buys and Sells in October 2015

Stock stalking is a weird hobby.

In general I do not "follow" any particular investor's activities. However, there are a couple that I have followed of sorts because I like their investment style. One of them is Neil Woodford

I watch Woodford's fund quite carefully to get some ideas. In particular, doing this with Woodford is comparatively easy as--I am sure many of you know this--he publishes the entire breakdown of his fund each month. Very unusual, but also very interesting.

Since launch I have been assiduously collecting this data and building a little spreadsheet to see how things are changing. I've realised that this work--which is not a tiny amount--may be of interest to some of you.

So here I will offer a little breakdown of the companies that Woodford has bought and sold in October 2015.


First, a little on my methodology. Woodford provides two bits of information each month which I use for this:
  1. The total value of all the assets in his fund (this month, £7.67 billion);
  2. The percentage weight each company has within the fund.
Using this information, I do a couple of things:
  1. Work out the value of the company holding (dividing the fund size by the company's weight)
  2. Using the share price on the day the snapshot of the fund was taken, I work out how many shares (approximately) Woodford holds in the company.
Now this provides an estimate of his shareholding in each company from month to month. It can then be used to work out what his big movers were during the month.

This is where it may be interesting to you.

Woodford's Big Buys in October

So what companies has Woodford been buying into?

Well, here is a list--according to my estimates--of listed companies that he increased his shareholding in by 3% or more. Those in bold were not in last months list of big buys. Those in italics were in last months big sells last month:

1Theravance BiopharmaNASDAQ:TBPH1273.03%
2RM2 InternationalLON:RM283.80%
5Game DigitalLON:GAME39.97%
7Allied MindsLON:ALM32.11%
8Northwest BiotherapeuticsNASDAQ:NWBO27.22%
13Provident FinancialLON:PFG7.21%
16Halosource Reg SLON:HALO6.14%
19NewRiver RetailLON:NRR4.62%
21Babcock InternationalLON:BAB3.49%
22Legal & GeneralLON:LGEN3.47%

For listed new entries, Woodford also opened a new position in Hostelworld (LON:HSW) with its IPO.

Woodford's Big Sells in October

So what companies has Woodford been dropping?

Again, this is a list of those which have dropped at least 3% or more. Those in bold were not in last months list of big sells. Those in italics were in last months big buys last month:

2Raven RussiaLON:RUS-4.13%
3Reynolds AmericanNYSE:RAI-3.51%

Woodford's Moves 

As with the last few months, Woodford has been buying quite widely but selling very narrowly.

The biggest sale was that Zegona which--after building up the stake of late--he nearly halved this month. Surprisingly, tobacco giant Reynolds American has seen a modest drop as well. However, this may be a product of calculation as it is close to my 3% error buffer.

Woodford's purchases last month were also heavily small-cap and pharma focused. The top buys are surprisingly light on large- or mega-cap companies compared to previous months.Some familiar names appear (AstraZeneca, Legal & General, Babcock, AA etc.) but they are chiefly smaller top-ups. Several other staple top-ups (for instance, GSK and BAE Systems) are missing this month.

The new addition of Hostelworld is very interesting. I will be investigating further. They appear to generate copious amounts of cash and plan to return 70 to 80% of profits to shareholders. If this comes true, HSW will be a very attractive income stock. 

Some Caveats

Obviously, as with everything on this site, this list is not meant to be advice on what to buy (or sell). Also, these figures are all created from different levels of estimated data. 

The weightings are rounded as is the fund value. Share holdings are therefore estimations rather than certain figures and--as a consequence--my calculations on their changes are not supposed to be seen as 100% accurate. Of course, at this final stage (that is, the write-up) there is also an additional rounding of the percentage changes.

Also, because of the way I collate the data it does mean that full sales of holdings will likely be missed. If you notice any, give me a heads up in the comments section below. For example, this month the Essentra position appears to have been sold out of.

Finally, remember this is an open-ended fund and so has cash flowing in and out of it constantly. As a result, for those companies Woodford particularly favours--if he wishes to keep them at a similar weighting--then each month would show a growth in his shareholding in them. what this means for the true nature of the purchase (confidence, consistency, or whatever) is up to you!

As usual, Do Your Own Research (DYOR)!

What do you think?

What do you think of some of Woodford's big movers? Did you make similar purchases/sells in October? Has the list got you thinking about any of the companies listed?

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[Image reproduced from Woodford Investment Management]


  1. I find it really interesting that he's going into the small-caps now. I guess because the large/mega caps of GSK and AZ are going nowhere fast (and Woodford wants to break up GSK anyway). Their figures are not looking good... The small-caps on the other hand are developing new tech, new breakthroughs - they could easily be takeover targets for the struggling mega-caps in the not too distant future...


    1. Yes, he has always had a penchant for the small-cap biotech and seems to do well from it! He tends to "trade" them a bit more, though. Also, the last few months he has continued to pump cash into GSK and AZN with this really being the first month this has slowed.

      I read that about breaking up GSK. Has it been confirmed that he has suggested this recently? It was just a rumour at the time. GSK may benefit from such a move, but I am not so sure at present. If they continue their move towards consumer and vaccines, it may well make sense. But at the moment? Seems a bit mixed with regards benefits.

      In the mega-cap's favour, they are still highly profitable. This cannot be said about many of the small-caps. They have still not quite grown into profit in most cases!

      His continued buys into Game Digital interest me. I really don't see a great future there. He does somewhere. Would be fascinated to find out for what reason! That being said, he has bought into and sold out of Game quiet frequently.

  2. Interesting stuff, thanks for compiling as usual. I don't recognise many of them, so might check out a few of them in case they're worth following for the future!

    His interest in Game does surprise me - does he know something we don't? My friend's sister works for them and from the sounds of it, things aren't great. However, she works in an actual store so perhaps they're doing every well re downloads, subscriptions etc?

    1. My pleasure, weenie. I know what you mean. Many of them are hardly household names! Worth a little root around for though in most cases!

      Yes, I don't really get Game. Their rename to Game Digital is perhaps a reflection of where they think growth will come from (that is, digital) but I can't see how Game can differentiate itself enough to secure their long-term future. I'd happily be wrong, he is certainly much more expert than I!