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Fund manager Neil Woodford has been taking a great deal of flak from his investors recently, but it now looks like one of his bets has come off.  The Woodford Patient Capital Trust, which is part of his stable for funds and investment trusts, is getting a much needed shot in the arm following the floatation of Autolus Therapeutics in the US, currently the trust’s eighth largest holding.

The value of Woodford’s stake in Autolus has jumped by 51% as the result of Autolus’ IPO, which was priced at a higher level than the book value of the investment. In turn, this has provided a 3.8% gain for the net asset value of Woodford Patient Capital.

“This outcome vindicates Woodford’s approach of finding businesses with outstanding intellectual property, helping them grow with financial support, and then reaping the rewards with exceptional long-term rewards,” says Russ Mould, investment director at AJ Bell.

Woodford Patient Capital currently has 89 holdings, indicating that Woodford is spreading his net widely in pursuit of other potential situations along the lines of Autolus. The timing of such valuation uplifts if unpredictable, however. Some investors still expect the investment trust to churn out good news and share price gains at a predictable rate.

Such is not the nature of the beast, however, and we may look to the name of the trust, Patient Capital, as an indicator of the type of investor who should be looking at this.

Autolus Therapeutics is a specialist in the development of treatment for blood cancer, focusing in on CAT T cells. It raised $150 million through the offering of 8.8 million shares. This was at the high end of the $15-$17 range market makers were asking for.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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