Wealth of global HNW individuals exceeded US$70T for first time: report

Global economic growth pushed the wealth of high-net-worth individuals (HNWI) past US$70 trillion in 2017 for the first time, says a report by consulting firm Capgemini.

Asia-Pacific and North America accounted for 74.9% of the increase in the HNW population and 68.8% of the rise in global HNWI wealth, said “World Wealth Report 2018.” HNWI wealth grew in Europe by 7.3%.

The U.S., Japan, Germany and China accounted for 61.2% of the global HNW population. The report defines a high-net-worth individual as someone with investable assets of more than US$1 million.

Read: What aging HNW clients mean for wealth management

Investment returns

The investment returns on global HNWI wealth (on assets managed by wealth managers) rose by 27.4% in 2017. For Q1 2018, 30.9% of HNWI financial wealth was composed of equities, followed by cash and cash equivalents at 27.2% and real estate at 16.8%.

Despite the rise in returns, only 55.5% of HNWIs said “they connected very well at a personal level with their wealth manager,” a release from Capgemini said. North American HNWIs were the most satisfied with their wealth manager (75%) while no other region surpassed the 70% threshold.

Growing interest in cryptocurrencies

Interest in cryptocurrencies continued to grow despite not comprising a significant part of portfolios for HNWIs. The report said HNWIs are “cautiously interested” in holding cryptocurrencies, specifically:

• 29% of global HNWIs have a high degree of interest while 26.9% are somewhat interested;
• 71.1% of HNWIs aged 40 and under think it’s important to receive information on cryptocurrencies from their primary wealth managers compared with 13% aged 60 and older.

However, only 34.6% of global HNWIs said they have received such information from their wealth managers.

Read the report here.

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