How the super-rich are investing in current markets
From the summer peak to August low, global equities fell by around 12 percent, mostly in the week leading up to the “Black Monday” mini-crash on 24 August.
Many equity markets fell by 20 percent from their previous highs, putting them in official ‘bear market’ territory, with China leading the way. This month hasn’t looked much better, with U.S. stocks seeing their worst start to September in 13 years and, even after the Fed held off on a rate rise, stocks still finished sharply lower last week.
High Net Worth investors, or individuals with at least $1 million in investable assets, tend to have less interest in the short term when it comes to putting their cash to work, but even they are feeling unnerved in the current volatile climate, analysts say.
CNBC takes a look at how the rich are coping.
Real estate remains core
Property has been a mainstay of high net worth investor portfolios for decades, as can be seen in the soaring prices in prime real estate in capitals around the globe. While data has showed that there has been some cooling in London property prices this year, real estate is still the wealthy investor’s go-to safe haven.
Simon Smiles, global chief investment officer for the ultra-wealthy at UBS said three years ago, clients were mostly concerned with investing in U.S., real estate.
Now he is seeing more of a shift to Europe, but clients are still inquiring about real estate more than any other asset.
“Today it is not so much about the U.K., it is far more about continental Europe. Mid-sized clients are looking for deals in terms of offices and real estate. Our larger clients are looking for trophy assets, luxury hotels and hotel chains,” Smiles, who deals with ultra-high net worth clients with investable assets of $30 million or more, told CNBC.