Rich Tales: The world’s richest are more numerous than ever, but they’re being cautious

The world’s wealthiest have recouped the losses incurred in the 2008 banking crisis, and are now richer and more numerous than ever.

Today there are more than 103,000 of what wealth watchers call ‘ultra-high-net-worth-individuals’, usually referred to as UHNWIs. To rank as an UHNWI, you need at least $30 million in assets. On top of that, there were 12 million high net-worth individuals worldwide, defined as those with $1 million in investable assets. There were 9% more high net-worth individuals this year than last.

Those figures are from an annual wealth report released last week by RBC Wealth Management and consulting firm Capgemini. The ranks of the world’s wealthiest grew strongly last year, following on from another healthy rise in 2011, when the numbers of the super-wealthy first hit pre-crisis levels.

The United States has had a run of positive economic figures in recent months, and the report unearths another. The number of high net-worth individuals in North America increased 11.5% in 2012 to hit 3.73 million. This put North America back on top as the continent of millionaires, eclipsing the Asia-Pacific, which grew 9.4% to boast 3.68 million millionaires, of which 207,000 live in Australia.

The report was prepared for wealth managers, so it looked in some detail at the investment preferences of the world’s richest. It surveyed 4000 global high net-worth individuals about how they like to invest their money and unearthed an interesting paradox.

Leverage and risk are how entrepreneurs get wealthy. But the wealthy people surveyed for the report showed a clear bias towards conservative asset allocation, putting nearly 30% of their wealth into cash and deposits.

This aversion to risk applied across all ages and wealth levels, and, the authors write, suggests a low level of trust in financial markets.

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