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 A wrap account is an administrative service that combines, or wraps, all of a client’s investments into a single manageable account. This means that their total portfolio can be viewed at a glance and involves a huge reduction in the amount of paperwork. It is not a product in which to invest, but rather a service.

A wrap is available online and lets financial advisers manage all of their clients’ assets in one place whether these are held directly or through a ‘tax-advantaged’ wrapper such as an Isa or a pension. Advisers using a wrap have access 24/7 to their client portfolios – this allows them to offer a more efficient and valuable ongoing service than has historically been possible.

Furthermore, while product recommendations have sometimes been based on investment performance and the importance of financial strength in delivering that performance, these factors have become less important as companies have increasingly offered what are known as open architecture investment propositions. This means that instead of constraining the investment choices to those offered by the product provider it is actually possible to access a range of investment groups. In some cases this approach may extend across the entire market.

To some extent, wraps have developed around the diminishing role of the product provider and the increasing appetite for greater investment choice – essentially wraps expose the ‘product’ as a commodity that is really no more than a regulated ‘box’ in which advisers can carefully tailor portfolios to meet the personal requirements and circumstances of each client.

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