I have always wanted a wrap, I just did not know what it was called. Now it is called the ASPL wrap – a white-labelled version of Standard Life’s platform.
The ability to produce client valuations 24/7 is very appealing and cost-effective. Modelling self-constructed portfolios sourced from a significant fund and securities range and which can be bought without an initial charge and with a reduced total expense ratio is fantastic.
Wrap can greatly assist and even become the foundation of your service proposition. It is an investment on the adviser’s part, so it is highly preferable if your provider similarly invests time, resources and technology in your business. This is what Standard Life has done for us.
With a lot of the regulatory noise about wraps centring on the costs, one of the many attractions of our wrap is ease of access to cost-effective exchange traded funds.
Wrap further helps move back-office emphasis from administration to service.
There is less need for paper and the ability to access live portfolios enables quicker responses to client queries.
Wrap is not appropriate for everyone and we have restricted access to clients who accept our revised terms and consequential improved levels of client care. Taxation of investment profits and exit penalties are likely to be the biggest barriers to the speedy migration of assets over the coming years – and rightly.
The more of us who adopt wrap, the better equipped we are as a profession to take on the big private bank and wealth manager institutions. Without this technology and efficiency, we are not as much of a threat as we should be.
More deep-pocketed entrants to the wrap market seem inevitable, as does the eventual consolidation of providers. Will separately managed accounts take off? Will easy access to ETFs become a driver? Who knows? What I do know is that our ASPL wrap, if not consistently beautiful, is at least rather good looking.
Adrian Smith is director of Adrian Smith & Partners