We are always interested to see how other investors are going, what they invest in and of course what financial issues they have in mind. I read about a recent survey undertaken by management consultants Capgemini showing how wealthy Australians invest and there are some interesting facts.
Enjoy, Nick Stratus
According to the survey, wealthy Australians, defined as investors who have more that $US1 million in assets outside the family home, have a much higher propensity to invest in property than their global counterparts. Property accounts for 30.8 per cent of wealthy Australians’ portfolios, compared with just 21.4 per cent for wealthy Asian investors. Globally, wealthy individuals invest just 18.2 per cent of their portfolios in property.
“Wealthy Australians think that property will give them the maximum return on investment,” Dipak Sahoo director of the financial services at Capgemini Australia, says.” In the rest of Asia, real estate does not rank as highly because property prices have cooled off,” he says.
When it comes to shares, wealthy Australians’ exposure is lower than the global average.
Despite the ongoing criticism that self-managed superannuation funds invest too much in equities, wealthy individuals in Australia have 26.5 per cent of their portfolios invested in shares, compared with 27.9 per cent for wealthy investors globally.
That said, the message from professionals that Australians need to diversify their portfolios away from the local market appears to be having an effect.
Sahoo says that deposit the dramatic fall in the Australian dollar over the past year, the proportion of wealthy investors’ share portfolios that is invested offshore rose to 30.7 percent in 2015, from 30.4 per cent in 2014.
Given Australians’ penchant for property, the latest Australian Bureau of Statistics figures will come as some relief. The bureau said on Tuesday the weighted average of the eight Australian capital city property prices soared 9.8 per cent in the three months to June, compared to a year earlier. House prices in Sydney surged 18.9 per cent in the June quarter, the fastest rate on record in the current series.
The Capgemini survey showed that wealthy Australians’ top three concerns were whether they would have enough cash to last their lifetime, whether they could afford to maintain their lifestyle in retirement and the rising cost of healthcare.
Source: The Australian Financial Review, By Sally Patten, Thursday 24th September 2015
For investment and financial planning advice, contact Nick Stratus from Solid Financial Advisors on 9690 2666 or firstname.lastname@example.org