Discretionary accounts (sometimes called managed accounts) grant a variety of benefits to clients and their advisory firms within important safeguards. A primary benefit is flexibility, so the firm does not have to go through the potentially cumbersome process of proposing, discussing, and seeking approval of each decision from the client.  With UHNW clients having significant assets requiring close monitoring and adjustment in a timely way, granting discretion to the firm allows assets to be bought, sold, exchanged, and otherwise managed on behalf of the client in an efficient and time-sensitive manner. Other benefits include being able to execute bulk trades for multiple clients at once or obtaining favorable prices or rates as a result of the scale of the trades.

Discretionary accounts require a client to sign a detailed disclosure agreement clearly specifying the nature and level of discretion being granted to the firm, including any exclusions, constraints, instructions, or parameters limiting independent discretion or for when the firm must consult the client in a decision. Although discretionary accounts normally require a high level of trust by the client towards the firm, there are also legal, regulatory, and (often) fiduciary safeguards that provide necessary oversight and/or consequences in the event provisions are breached and the firm is therefore liable.