Individual investors looking to personalize their portfolios are pouring billions of dollars into “separately managed accounts,” bucking the trend toward passive investing in mutual funds and exchange-traded funds in favor of active, individualized money management. Separately managed accounts are sometimes called wrap accounts, private accounts or individually managed accounts, among other things. But they are discrete investment accounts held by individual investors for which the money is invested by a professional money manager. The account can begin as one of many investment-style templates available, but then are personalized by the money manager based on the financial and tax needs of the client, as well as the client’s individual preferences.

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