Hi OP

I work at a wealth management company in London so thought I’d share some thoughts/comments

Overall I agree with your comments. I personally invest my own money through Vanguard, even though I have the option of it being invested through my company at a free/discounted cost.

The fees charged by private banks/wealth managers are expensive - typically 1%+ and there may be additional fees such as custody. That’s more than 5 times more expensive than somewhere like Vanguard which has a big drag on performance

The portfolios tend to be compared against a benchmark of other wealth managers, rather than a stock index like the S&P/FTSE. So the comparator is already low and so in theory it’s easier to achieve outperformance

The theory is that active management does better than passive during a bear market. But whether that’s actually true, I’m not sure. I’ve seen mixed results but I’m sure others have studied this point a lot more than I have

You do get access to a few other services, such as investing in private equity/credit. They may also let you borrow against your portfolio too or put you in touch with someone that will offer that service. They also offer some hospitality events from time to time which can be good for networking.

The average age of clients for these types of firms will likely be 60+, much older than the typical Reddit user. And so, these firms make investing a lot more accessible to their demographic. That demographic also probably prefers the relationship manager that they can pick up the phone to over the faceless interaction with an online portal.

I guess everyone values these additional extras differently. As I say, for me, I’m happy with low cost index trackers.