BT ramps up baby wrap

BT Financial Group’s no-frills wrap, Wrap Essentials, has undergone its largest menu expansion since its inception, adding 14 new funds including the first fund of hedge funds on an Australian ‘baby wrap’.

Wrap Essentials now houses 52 funds, but BT’s head of wrap distribution Don Sillar said this was not a cost disadvantage in the low-fee platform marketplace.

“Fifty-two gives us more funds than Asgard Elements, about the same as ING and less than Skandia and Colonial FirstChoice, but you’ve got to remember that our baby wrap is on the same platform as our main wrap, where the others tend to be separate.”

Six of the 14 new funds are income-producing funds.

Sillar said this reflected “advisers’ desire to offer alternatives to complement the already saturated mortgage fund market”.

Investing in everything from international fixed interest to buy and write securities, the new income funds are the Colonial Income Fund, Challenger High Yield Fund, Macquarie Diversified Fixed Interest Fund, Merrill Lynch Monthly Income Fund and PM Capital Enhanced Yield Fund.

The pioneering hedge fund-of-fund option will be managed by US-based Grosvenor Capital Management, while another notable addition is Intech’s High Opportunity Fund, a global multi-manager fund.

Intech’s roster currently includes: Marvin & Palmer and Wellington — both global growth managers; Marathon — a global value manager; Pzenza and Sands Capital — US value and growth managers respectively; Bernstein — a non-US value managers; and William Blair — a non-US growth manager.

A BT spokesperson said Wrap Essentials was growing at about 2 per cent a week, with inflows between $2 million and $4 million recently carrying its total assets over $200 million.