We initially became interested in the wrap market when we finalised the development of our new investment process.
Our process is based on low-cost, passive asset class investing and the bulk of the investments that we wanted to use were not available via the mainstream insurance companies or platforms such as Fidelity, Cofunds and Skandia.
As our investment process depends on keeping costs to an absolute minimum, it was vital to find a platform that would be scalable across the varying sizes of portfolio that we manage for our clients.
We therefore discounted the providers that used a tiered charging structure, as this increased the cost of our smaller portfolios to an unacceptable level. We also wanted to avoid platforms that imposed an initial charge for investing and/or charged for switching between investment funds.
With this in mind, the Nucleus platform stood out for us as the natural choice of wrap. Its flat annual charge of 0.35 per cent and lack of initial or switching charges met the above criteria and we were impressed by the transparent and independent nature of the Nucleus offering.
We carefully considered the fact that Nucleus was in its infancy and the obvious temptation was to opt for a more established platform.
However, after talking to the Nucleus management in some depth and completing the necessary due diligence, our belief in the long-term viability of the platform was affirmed.
We were also greatly attracted by the requirement to invest in the platform and become a shareholder in the business. Following our dealings with large insurance companies and platforms for many years, it was refreshing to be able to influence the development of the Nucleus platform.
Our experience since starting to use the platform is that this is much more than them just paying us lip service and we do have a real voice in the platform’s development via adviser strategy meetings and admin user groups.
We are now more than 12 months into the migration of our clients on to the platform. We decided to do this in a very controlled fashion as we conducted annual client reviews and the migration is going extremely smoothly.
We are also part of the way through a bulk re-registration from Transact and have been given a great deal of assistance by both Nucleus and Transact, which has been most professional in dealing with the re-registration away from their platform.
The Nucleus wrap is now an integral part of our client proposition and enables us to deliver our investment process extremely efficiently. Our clients are allocated to one of seven model portfolios, with automatic rebalancing, taking away a huge amount of work from our administrative staff.
This frees up a considerable amount of time to concentrate on dealing with other aspects of our clients financial planning. It has been hard work but definitely worth it.
Tim Walsham is director of BRB