Ultra-rich prefer equities, bonds for investment: Knight Frank report

Ultra-rich prefer equities, bonds for investment: Knight Frank report

Agency News

Mumbai, Mar 6: Knight Frank, a leading global property consultancy, on Wednesday released its annual report titled 'Knight Frank Wealth Report.'

The Attitudes Survey segment in the report has published the succint responses given by 600 private bankers and wealth advisers who manage over $3 trillion of wealth of the Ultra-High Net-Worth Individual(UHNWI) clients.

The survey for the year 2018 tabulated that 63 per cent of respondents stated that the wealth of their UHNWI clients registered a spike whereas 16 per cent of respondents answered that it's other way round.

Forecasting the wealth creation opportunities for Asian UHNWI in the current fiscal, the respondents were pessimistic owing to the prospect of continued higher interest rates and with the ongoing China and US trade tariffs.

The Singapore's wealth advisors were the Asia's least optimistic, with only 1 in 4 respondents, expecting their clients' wealth to grow.

The wealth managers in China,Hong Kong, Indonesia, South Korea, Taiwan and Singapore expect domestic politics and economic issues to make it more challenging to create and protect wealth in 2019, mentioned the survey.

The survey claimed that in India,where the volume of wealth is rising the fastest globally, UHNWI in the country are expected to decrease cash exposure and increase their allocation to private equity in 2019 as local investors grow in sophistication.

The survey mentions that real estate makes up 23 per cent of UHNWI portfolios in Asia which is higher than the global average of 21 per cent.

Knight Frank Global Head of Research Liam Bailey said, "We have noted in previous years a growing desire from UHNWIs to increase the share of their portfolios dedicated to property. This trend has been confirmed by the growth in the average number of homes owned by wealthy people increasing from 2.9 to 3.6 over the past year."

The Indian respondents asserted that their UHNWI clients preferred the high return investment assets,equities and bonds whereas the real estate ranks third in the preference of ultra-rich.

Knight Frank India Chairman and MD Shishir Baijal said, "While globally UHNWIs are showing affinity towards more liquid investments as it is the most risk averse asset,Indian counterparts on the other hand are increasing their exposure in the equity and bonds.

"There is a sense of confidence amongst Indian UHNWIs on the strength of the country's economic growth which is pushing them to invest in higher risk assets for shorter periods of time." (UNI)