The manager came under pressure for poor one- and three-year performance as of 2011, but he has proven his critics wrong yet again and stormed to the top of the total-return tables.
Performance of funds vs index and sector over 10-yrs
| Name |
1-yr returns (%) |
3-yr returns (%) | 5-yr returns (%) | 10-yr returns (%) |
| Invesco Perp - High Income |
6.48 |
45.65 |
9.32 |
118.02 |
| Invesco Perp - Income |
6.33 |
44.78 |
8.5 |
114.63 |
| FTSE All Share |
-3.94 |
39.91 |
1.36 |
60.49 |
| IMA UK Equity Income |
-0.99 |
39.52 |
-4.82 |
57.92 |
Source: FE Analytics
Despite a strong start to 2012 for cyclicals, the two portfolios – which remain overweight defensive sectors such as pharmaceuticals and tobacco – are also top quartile year-to-date, and over three- and six-month periods.
While one-year performance is generally seen as too short a period to pass judgement on, Woodford’s underperformance over three years began to worry some IFAs at the start of 2011.
However, the funds’ ability to protect against the downside during last year's summer slump, and maintain steady outperformance in 2012, has cancelled out their inability to keep up with the markets in 2009 and 2010.
Performance of funds vs sector and index over 3-yrs
Source: FE Analytics
This softly-softly approach has also worked well for the funds in the longer term; according to FE data, Invesco Perpetual Income and High Income comfortably take the number one and two spots in the sector over 10 years, with returns of 118.02 and 114.63 per cent respectively.
The portfolios are even more dominant over 15 years, amassing around 300 per cent apiece.
Needless to say, their large cap, defensive focus and strong performance during down markets also mean they are among the most stable of their kind. Both have an annualised volatility over the last decade of 12.9 per cent, compared with 15.33 per cent from the FTSE All Share.
"It’s important to know why a manager has underperformed over a set period, particularly if you’re looking at three years," said Tim Cockerill, head of research at Rowan Dartington.
"Three years is a decent measure of performance, but the best managers have a proven record over a series of market conditions."
"As long as you know why the manager has underperformed over three years, I don’t think it’s too much of a problem. Woodford, for example, was very clear in why he was positioned in the way that he was."
"In my opinion, when looking at a track record, the longer the better," he added.