The spectacular fall from grace of Britain's star investor Neil Woodford has tarnished the reputation of London's City finance district and hurt market confidence, according to analysts.Few commentators imagined that Woodford Investment Management, which once boasted billions of pounds in assets under management, would spectacularly collapse this month having taken on too much risk.The group's flagship Equity Income fund was suspended in June to stop it haemorrhaging cash.Woodford was then forced to quit and liquidate the fund on October 15.One day later, Woodford quit his two other funds in what he described as a "highly painful decision" - and added that the whole business would be wound up.The news has sparked big losses for Woodford's customers who include pension funds, wealthy individuals and other fund managers.'Shaken to core'"We have seen the complete demise of the most famous fund manager the UK has seen for years," Adrian Lowcock, head of personal investing at brokerage Willis Owen, said in a statement."Investors knew the scenario was bad but the indication from Woodford thus far had been that the (Equity Income) fund would reopen," Lowcock said. "This collapse... will shake the funds industry to its core."Woodford, 59, forged his name as the nation's top stockpicker in a glittering 30-year career in the asset management business, most of which was at investment manager Invesco Perpetual.He had been regarded as a safe pair of hands after reportedly guiding his funds away from the dotcom bubble crisis in the early 2000s, successfully backing traditional stocks like tobacco instead of technology.The outspoken Woodford - nicknamed "Britain's Warren Buffett" by media after the legendary US investment guru - also carved out a reputation as an activist investor willing to hold company CEOs to account.In 2014, Woodford established his Woodford Investment Management in an industrial estate on the outskirts of Oxford, which earned him the new moniker the "Oracle of Oxford".At its peak in 2017, the business had total assets of $17.9bn under management.Yet five years later, the business model hit the rocks as a series of disastrous investments turned sour.In particular, Woodford had ploughed cash into a number of unlisted healthcare and technology companies, as well as poor stock market bets.As more and more investors started asking for their money back, Woodford encountered difficulty raising sufficient cash quickly enough.'Investment scandal'The Financial Times described Woodford as Europe's biggest investment scandal for a decade, labelling him the star fund manager who fell to earth.Industry veteran Jonathan Little argued the collapse would stop the hero-worshipping of investment bigwigs like Woodford."If there is anything good to come out of this, it is that investors will move away from the industry's Hollywood-style culture of star worship," Little told the FT.Darius McDermott, managing director of Chelsea Investment Finance, said the sector now needed to regain trust."The whole situation has been awful for investors... and damaging for the industry," McDermott said."At a time when people should be saving more, not less, and when UK equities are so out of favour, it is worrying that so much trust has been lost."We now need to work hard to get that trust back," he added.The sector has, however, attracted fierce criticism, including from the Bank of England governor Mark Carney."These funds are built on a lie, which is that you can have daily liquidity for assets that fundamentally aren't liquid," he told lawmakers in June.In Britain, an estimated 9.0 trillion of assets are overseen by fund managers, making it the second biggest market after the United States.Uner Nabi, financial services associate partner at EY accountancy group, said the furore could even help the sector in the long term."Any short-term reputational damage is likely to be more than offset by the overall progress being made by managers and the regulators to protect customers," he told AFP.