This week Mark Loosmore of AT8 Group goes to Transact, the largest and oldest of the pure wrap platforms
We have reviewed many of the wraps in the market, but none to date have come close, in terms of Assets under Administration (AUA) to the fund supermarkets. The largest wrap to date that we have reviewed was Standard Life, with about £6bn AUA, whereas Cofunds had £28bn AUA and Skandia £32bn AUA.
This week I spoke to Malcolm Murray, marketing director at Transact – the largest of the pure wrap players – to see how the platform is shaping up.
Transact is the oldest of the wrap platforms being the first to launch a wrap service in the UK, back in 2000. Transact used technology and systems already developed and pioneered in Australia, where wraps were established some time ago. With its own in-depth knowledge of the UK investment market, Transact aimed to create a wrap service designed to suit the needs of a broad range of UK advisers and investors. While proud of its Australian heritage, Malcolm was keen to point out that after 11 years of trading in the UK, the links to Australia are increasingly less relevant.
Breaking through the £10bn AUA last month, Transact is nearly double the size of any other UK wrap. And, while still substantially smaller than the fund supermarkets, it is one of the few profitable wraps in the market today. More important, this profitability is not a transient phase: it had its first profitable month in June 2003 and has been profitable every month since. Last year it posted trading profits of more than £10m.
Malcolm gave me access to the platform to investigate the functionality further. Normally I am provided with a demonstration of the tools, with an expert user to guide me through the key features. Murray’s approach of letting me wander at will through the site meant I discovered a real feel for its usability.
The platform itself was extremely easy to navigate. In terms of a place to trade and keep a wide range of different asset classes, and to report on these investments was very straightforward. It has a no-nonsense approach to managing a customer’s investments. It didn’t have the full range of tools that some sites have.
There was no risk-profiling or factfind capability, for example. However, I have long believed these features should not necessarily be performed on platform anyway. The sales process and risk-profiling solutions an adviser uses should be consistent across all the adviser’s clients, regardless of the investment solution being on or off platform. This should help to remove bias towards using the platform to transact an investment, adhering to TCF principles and good business practice.
Paul Bruns and Elaine Parkes
3,000 left to transfer
Record numbers of people aged 90 plus
From 3 to 10 October