Whole of Market Investing: What Investors Need to Know

This article examines what a whole of market investment approach means, how it compares with restricted and single-provider models, and the factors investors should consider when assessing how investment decisions are made on their behalf.

At a glance 

• Whole of market means access to a broader range of investments.
• Whole of market does not mean using every available fund.
• More choice does not automatically create better outcomes.
• Strong governance and oversight remain essential.
• Investors should focus on how investment decisions are made, not simply the label attached to an investment proposition.

What does ‘whole of market’ actually mean? 

A whole of market investment approach means an investment team can assess funds and managers from across the wider investment universe when constructing portfolios. Rather than being limited to a single provider or a small panel of providers, the team has access to a broader pool of investment options.

Importantly, whole of market does not mean every available investment is used. Instead, it means there is greater freedom to identify investments that may be most appropriate for a portfolio’s objectives and risk profile.

The principle is straightforward: if different managers have strengths in different areas of the market, a broader opportunity set may provide greater flexibility when building portfolios.

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How is a whole of market approach different from a restricted or single-provider approach? 

Investment approaches generally sit on a spectrum.

At one end are single-provider solutions, where investments are sourced from one organisation.

In the middle are restricted approaches, where investment teams may select from a limited range of providers or solutions.

At the other end is a whole of market approach, where investment teams can assess opportunities across the wider investment universe.

It’s worth noting that labels alone do not determine investment quality. Well-governed portfolios can be built under different models. The key question is how investment decisions are made.

Why are some firms choosing single-provider solutions? 

Over recent years, many firms have partnered more closely with large investment providers. There are several reasons why.

For smaller firms, simplicity can be attractive. Working with a single provider may mean:

• One investment proposition to understand
• One relationship to manage
• One set of communications and investment updates to monitor
• Reduced operational complexity

This can allow advisers to spend more time focusing on financial planning and client relationships.

Larger organisations may also benefit from additional support, including reporting tools, research capabilities, educational resources or bespoke solutions negotiated with providers.

For some firms, this streamlined approach can be efficient and practical. 

Where does a whole of market approach fit into this picture? 

A whole of market approach starts from a different assumption. Rather than expecting one investment provider to excel across every asset class, region and investment style, the belief is that specialist expertise may exist in different places.

For example, one manager may have expertise in emerging markets, while another may be stronger in fixed income. Elsewhere, a manager might specialise in global equities or focus on systematic investment strategies. A whole of market framework allows investment teams to consider those specialist strengths when constructing portfolios.

The objective is not greater choice for its own sake. It is the ability to select investments that fit a portfolio’s objectives. 

Does more investment choice lead to better outcomes? 

Not automatically. A wider investment universe creates more opportunities, but it also creates more decisions. The quality of a portfolio depends on far more than the number of available funds.

Effective portfolio construction requires investment teams to assess:

• Risk levels
• Return objectives
• Diversification requirements
• Costs
• Manager capability
• Portfolio fit

In other words, access to more investments is only valuable if there is a disciplined process for evaluating them. Without a robust framework, more choice can simply create more noise.

How do investment teams select funds and managers?

Portfolio construction typically begins with the portfolio’s objectives.

Questions might include:

• What level of risk is appropriate?
• What returns are being targeted over the long term?
• How much diversification is required?
• What role should each investment play?

Only after these questions have been answered does fund selection begin.

Investment teams then assess a range of factors, including:

• Investment philosophy
• Consistency of approach
• Risk management
• Costs
• Portfolio construction
• How an investment complements existing holdings

This is why selecting investments is far more nuanced than simply choosing the best-performing funds from the previous year. Past performance can be informative, but on its own it rarely provides a complete picture of future suitability.

Can a portfolio become over-diversified? 

In some cases, yes. Diversification is an important investment principle because it helps reduce reliance on any single investment, sector or region. The FCA’s InvestSmart guidance explains diversification as spreading investments across different markets to help manage risk and avoid ‘putting all your eggs in one basket’. See the FCA’s guide to diversification.

However, adding more funds indefinitely does not necessarily improve outcomes. If multiple funds hold similar underlying investments or follow similar strategies, investors can end up with duplication rather than true diversification. The aim should not be maximum diversification at all costs. Instead, the goal is thoughtful diversification, where each investment contributes something distinct to the portfolio. In practice, this often means searching for the right balance between concentration and complexity.

What are the challenges of a whole of market approach?

The benefits of a wider investment universe often receive the most attention, but there are also challenges.

A whole of market approach requires:

• Extensive research
• Ongoing due diligence
• Regular monitoring
• Strong governance
• Clear decision-making frameworks

The broader the range of potential investments, the greater the resources required to assess them properly. This is why investors should look beyond labels and understand the governance framework supporting investment decisions.

Choice alone is not an advantage. The value comes from identifying suitable investments and combining them effectively within a portfolio.

What questions should investors ask?

If you’re reviewing your investments or speaking with a financial adviser, consider asking:

About the investment proposition

• What does ‘whole of market’ mean in your service?
• Do you use in-house investments, external funds or a combination of both?
• Are your underlying investments all tied to one provider?

About investment selection

• How do you decide which funds make the shortlist?
• How do you assess risk, cost and potential return?
• How often are investments reviewed?
• What would cause you to replace a fund or manager?

About your personal objectives

• How does this portfolio align with my goals?
• How does it reflect my attitude to risk?
• What risks should I be aware of?
• What are the total costs involved?

These questions can provide valuable insight into how decisions are made on your behalf.

Key takeaways

A whole of market investment approach provides access to a broader range of investment opportunities, but broader choice does not automatically lead to better outcomes.

The most important factors remain the quality of the investment process, the expertise behind the decisions, the strength of the governance framework and whether the resulting portfolio is appropriate for an investor’s objectives.

Ultimately, investors should focus less on labels and more on understanding how investment decisions are made, how portfolios are monitored and whether the approach is designed to support their long-term goals.

Please note

The information contained within this article is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK.

This article is distributed for educational purposes only. This communication does not constitute financial advice. Individuals must not rely on this information to make a financial or investment decision. Before making any decision, we recommend you consult your financial planner to take into account your particular investment objectives, financial situation and individual needs.

The opinions stated in this article are those of the author and do not necessarily represent the view of Progeny and should not be relied upon to make a financial decision.

Information contained herein has been obtained from sources believed to be reliable but is not guaranteed.

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Past performance is no guarantee of future performance.

The value of an investment and the income from it can fall as well as rise and investors may get back less than they invested. Your capital is therefore always at risk. It should be noted that stock market investing is intended for the longer term.