Wrap account


Also found in: Dictionary, Wikipedia.
Related to Wrap account: Wrap fee

Wrap account

An investment consulting relationship for management of a client's funds by one or more money managers, that bills all fees and commissions in one comprehensive fee charged quarterly.

Wrap Account

A brokerage account where the brokerage agrees to conduct transactions for the client for a flat fee, usually assessed on a quarterly or yearly basis. This differs from most brokerage accounts where transactions occur in exchange for a commission on the size of the transaction. A wrap account exists to protect the client from overtrading, which is the (illegal but sometimes hard to detect) practice of a broker making transactions to extract commissions rather than to benefit the client. Because this can result in less profit for the brokerage, a wrap account often requires a minimum investment of anywhere from $50,000 to $100,000.

wrap account

A special investment account in which all of the account's assets are entrusted to a professional money manager. All expenses relating to the account, including professional advice and commissions, are wrapped into a single annual fee that generally ranges from 1 to 3% of the total market value of assets in the account. Wrap accounts are designed for individual investors who choose to have a professional money manager handle a part or all of their investments. These accounts usually require minimum initial investments of at least $25,000.

Wrap account.

A wrap account is a professionally managed investment plan in which all expenses, including brokerage commissions, management fees, and administrative costs, are wrapped into a single annual charge, usually amounting to 2% to 3% of the value of the assets in the account.

Wrap accounts combine the services of a professional money manager, who chooses a personalized portfolio of stocks, bonds, mutual funds, and other investments, and a brokerage firm, which takes care of the trading and recordkeeping on the account.

Mentioned in ?
References in periodicals archive ?
began offering the wrap account service on May 1 by teaming up with Mizuho Bank, an arm of Mizuho Financial Group Inc.
Before amendment After amendment * Wrap account commissions for * Commissions to be determined discretionary and non- between securities company discretionary investment advisory and investor services by securities companies based on total assets managed * Securities companies barred * Securities companies allowed to from charging brokerage charge brokerage commissions for commissions for securities securities trading for wrap trading for wrap accounts accounts
For a free guide explaining Wrap Accounts call 0800 544 644.
Morris said it has transformed from an asset-gathering organization that sold variable annuities and mutual funds into an organization with full trading capabilities, including wrap accounts, separately managed accounts and fee-based planning, all initiatives to give Signator's agents the ability to "compete in a world that's not just an insurance world today.
A recent report on such accounts by Cerulli Associates, a Boston investment consulting firm, says that mutual fund Wrap account assets make up 11% of total Wrap assets under management, with $12.
In the typical wrap account program, every aspect of investing--from trade execution to account management--is handled by a single manager for one all-inclusive fee.
In the United States, assets held in wrap accounts, more popularly called SMAs, stand above $500 billion, according to Nikko Cordial Securities Inc.
Areas of interest may include wrap account suitability, effectiveness of disclosures, conflicts of interest, and brokerage practices, including best execution and trading away.
Yunger also held senior positions with Bank of America in their Consulting Services Group, where she played an integral role in the launch and success of their fee-based brokerage & managed wrap account programs.
3 billion, which Ameriprise attributes to wrap account net inflows and higher earnings on cash balances that were more than offset by lower client activity and a 5% decline in average equity markets.