The super rich lost money in 2022… But where did they invest?

A (small) setback for the super-rich. According to a new study by the consulting firm Knight Frank, published on Wednesday, March 1, in 2022 their wealth has decreased by 10%. This represents “a decrease of approximately $10.1 trillion,” the report said. If 4 out of 10 super-rich did achieve an increase in their wealth, then the trend “remains negative.”

The ultra-rich (also called UHNWI) refers to the approximately 392,000 people in the world who have at least $30 million to invest. According to the firm, their portfolio has suffered from the effects of a “permacrisis”, that is, an economic, geopolitical and energy crisis. “Last year, the Ukraine crisis added fuel to the fires of the European energy crisis and stoked already soaring inflation,” said Liam Bailey, head of global research at Knight Frank. Consequence: Several central banks have raised their rates to cope with the inflation that has affected investment portfolios.

The super rich keep buying stocks

However, the super-rich have found a way to make new investments. More than a quarter (26%) of the funds they can invest goes into buying shares. Next comes commercial real estate (21%), bonds (17%).

Europe has suffered more

The super-rich Europeans and Americans spend 28% and 33% of their investments, respectively, on buying shares, while the super-rich Africans are more focused on commercial real estate. Bonds are also more popular in Africa (25%) and the Americas (21%) than in Europe (19%).

Generally speaking, even if investment continued, it was in Europe that the drop in the fortunes of the super-rich was the most significant. It melted by an average of 17%. They are followed by Australia (-11%) and America (-10%). In comparison, Africa and Asia experienced the smallest declines (-5% and -7% respectively).

However, with “significant risks remaining for the global economy” in 2023, “market sentiment will change rapidly” with “very real opportunities emerging in global real estate markets” and a tipping point in interest rates is expected this year, according to Liam. Bailey. . According to research by Knight Frank, 69% of wealthy investors expect their portfolio to grow this year.

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