WRAP ACCOUNT ANALYSIS

The term “wrap account” was initially used by stockbrokerage firms that combined all of the costs for maintaining an account into a single “wrapped” fee. The client was changed a percentage of the assets for services provided by the firm. During the last fifteen years, these types of accounts have gained popularity and the use of the term “wrap” has broadened to include many account types.

Separate Asset Managed Accounts are offered by most of the major stockbrokerage firms. These accounts are often branded and known by names such as Consults or MACS. These accounts combine services that can include client risk assessment, money manager search and selection, trading, performance monitoring, advice and commissions into a single fee. The client signs a power of attorney that grants trading authority to the money manager.

Another type of account that is often referred to as a wrap account is one where the fee pays for either transaction commissions alone or commissions bundled with advice. These accounts also have trade names such as Unlimited Advantage. Active investors who make their own investment decisions can find these accounts advantageous.

A Registered Investment Advisor provides a third type of account that is often referred to as a wrap account. If the RIA is not affiliated with a stockbrokerage firm, the fees may cover only advice. Other costs are usually the client’s responsibility.

Regardless of the type of wrap account in you need analyzed, we stand ready to review the relationship between the broker and the client, the fees charged, the suitability of the advice and the suitability of the portfolio. Securities Litigation Support can provide written reports and hearing testimony on their opinions.