Wraps and master trusts

Wraps and master trusts can provide convenience and choice, but beware high fees and adviser kick-backs.
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Here are some of the advantages of wraps and master trusts:

All your investments are in one place. Investment platforms (such as wraps and master trusts) can combine your managed funds, other investments and even margin loans or shares into one package, which you can often access over the internet.

Consolidated reporting. Particularly handy around tax-time — you’ll get one report and statement for tax purposes and you may also receive regular reporting updates.

Diversification and choice. You can spread your risk among different asset classes and a much wider range of fund managers than would otherwise be possible for most investors.

Wholesale funds. Some ‘boutique’ and wholesale fund managers aren’t available to consumers, requiring initial investments of anywhere from $100,000 to $500,000. Wraps and master trusts can pool your money with thousands of other small investors to access these wholesale funds, which generally have lower management fees than retail funds.

Tax advantges could also be worth investigating; fees may be tax deductible with certain platforms.

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