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IFAs favour diversity and value for money when choosing a wrap platform

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New research from Investec Specialist Bank reveals that the overwhelming majority of IFAs (88%) consider the choice of funds and tax wrappers as the number one factor when selecting a potential wrap platform for client investments.

This was followed closely by value for money or value for fees charged (84%) and technical support and ease of online administration (82%).
 
The average net worth of the clients of IFAs surveyed using wrap platforms was £422,000. Typically, these IFAs use two different wrap platforms, although one in five (20%) said that they regularly use four or more different platforms. 
 
The research by Investec revealed that 49% of IFAs cited consolidating client portfolios as the number one key reason for using a wrap platform. Simplicity/ease of use was chosen by nearly one in four (23%) as the main reason, while 18% believed a wrap platform helped to free up more time to spend on asset allocation and investment management.
 
Lionel Ross (pictured), Investec Specialist Bank, says: “Competition in the wrap platform market is intense and our research shows that IFAs have a clear view of what they are looking for when selecting which ones to use.  Many intermediaries are becoming more demanding here and it is imperative that wrap platforms continue to widen their range of funds and cash products as investors needs are becoming more complex and demanding.”

Of those IFAs already using wrap platforms, nearly half (49%) said that their preferred type of deposit option is for Fixed Term Deposits, followed by Notice Deposits (30%) and then Structured Deposits (17%).
 
Ross says: “Wrap platforms are growing in popularity among IFAs who recognise that they are a great tool in managing clients’ funds more efficiently.  However, in this low interest rate environment, it is even more important that the cash element of an investment portfolio is delivering competitive returns. 
 
Investec’s Specialist Cash Products team offer a range of cash management products to meet the various requirements within the pension portfolio, for both IFAs and pension advisers. These include Fixed Term Deposits, the Investec Pension and Trust Reserve Account and the Investec Income Account.
 
 

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