Most of them saw Woodford (pictured) as a one-firm man and predicted his departure would coincide with his retirement. The details of his new venture will not be made public until his official departure in April of next year, but that has not stopped industry figures speculating on the FE Alpha Manager's next move.
One of his more ambiguous parting statements – "My decision to leave is… based on my views about where I see long-term opportunities in the fund management industry" – has only added fuel to the fire.
Here, four industry experts offer their predictions about what area of the market Woodford will end up focusing on, with every one of them offering a different view.
Bill Mott (pictured), manager of the Psigma Income fund
"I’ve known Neil for a very long time, and this is purely speculation, but I’d be amazed if he ran another UK equity income fund," said Mott. "Start-ups are his real passion. I think he’ll do something in this area."
Mark Dampier, head of research at Hargreaves Lansdown
"I’d be absolutely amazed if he didn’t run an equity income fund – I just can’t see that happening," Dampier said.
"I agree with Bill [Mott] – I do think he’ll launch a fund of start-ups, but that doesn’t mean he can’t have an equity income fund on the side."
"The start-up fund will be really interesting because Neil will run it on a five-year view or more, which differs greatly from private equity firms, which are far more short-term."
"The thing with a fund like this, though, is that it won't have a great deal of capacity. Equity income, which is Neil’s bread and butter, is the area that will bring the money in."
Dampier (pictured) thinks that Woodford will run any new equity income venture in a similar manner to the Invesco Perpetual Income and High Income funds, even though he will have more flexibility.
"The fund will be smaller at the beginning, but I suspect he’ll hold the same kinds of companies as he does now," he said. "A lot has been said about the fund size, but Neil has always kept the same kind of focus. When the fund was much smaller, he had the same kind of focus, so I wouldn’t be surprised if he keeps a lot in pharmaceuticals and areas like that when he sets up his new fund."
Dampier says that he is likely to follow Woodford if he does indeed launch an equity income fund, but adds that does not mean he will sell out of Barnett.
"I’m not sure there’s a great deal of capacity in the UK Equity Income sector," he said. "I think the choice investors will be met with is Woodford or Barnett."
"We still don’t know how much of the success [of Invesco Perpetual High Income and Income] was down to Woodford and how much was down to Barnett."
"We also don’t know how much Neil was dependent on the resources given to him by a firm like Invesco."
"I think he’ll carry on using his band of brokers, so I don’t think he’ll be hugely affected, but there are a lot of unanswered questions."
Dampier won’t be alone in following Woodford: a recent FE Trustnet poll showed that almost a third of our readers hope to invest in his new venture, regardless of what focus it takes on.
Jason Hollands, managing director of business and communications at Bestinvest
"There’s always a risk when investing in something different from where you’ve had your success," said Hollands.
"If he only did a start-ups fund, capacity would fill up very quickly, so I’d be very surprised if that’s the only thing he did."
"Logically, you’d expect him to stick to the area where he built his track record, which means equity income."
"He’s proved he can run money on an exceptionally large scale and this will be a very profitable area for him – especially as there will be fewer levels of management compared with a bigger firm."
Interpreting Woodford’s reference to where he sees long-term opportunities in the fund management industry, Hollands (pictured) believes there is a chance that the manager will run a global equity income mandate in some shape or form.
"If you look at all of the pension schemes of recent years, it’s very rare to see any run with only a UK equity income mandate," he said. "They’re all either global, or focused on global emerging markets.""This makes sense given that UK companies are themselves so global these days. If you’re going to compare BP to a rival company, you’re going to have to look at Exxon, so it makes sense to run a global mandate."
"I’m only speculating, but if Woodford were to use his expertise and also move with the times, it would make sense for him to invest for income across a number of different regions. To my mind, it wouldn’t be a surprise if he did that," Hollands added.
Hollands says he would consider investing in any product brought to market by Woodford, but would have to analyse the strategy and objective like any other prospective holding.
Brian Dennehy (pictured), managing director of Dennehy & Weller
Dennehy thinks that the commercial interests of Woodford have been underestimated and as a result thinks any discussion over which direction he will take is futile. "You’ve got to remember that he’s setting up a new business and that he needs to run that in a commercial way," he said.
"Neil Woodford is not stupid – he won’t be running a business based on the merits of one fund."
"So will he run an equity income or a start-up fund? The answer I think is that he’ll do both and some other bits and pieces as well."
"He has an extraordinary amount of experience and I would have thought that he already has a team looking at potential areas and which ones are seeing the most interest in terms of inflows."
