High-net-wealth investors unsophisticated in approach

Posted by Anton Murray Consulting on . Posted in News


A new report into the investing habits of high-net-wealth individuals has found that their portfolios are not very sophisticated. The inaugural State of Wealth report by Crestone Wealth Management and CoreData has found that the majority of high-net-wealth and ultra-high-net-wealth individuals invest in just three asset classes, cash, Australian equities and residential property. Head of strategy and development at Crestone Wealth Management, Clark Morgan said most of the respondents had very concentrated investments in just these three areas which surprised him.

“It is a bit of a shock how relatively unsophisticated the portfolios are – the HNW/UHNW investors appear to have a stated risk profile that is not actually matched by the portfolio, and their lack of diversification poses significant risks,” he said. Eighty-one percent held cash, while 56.4 per cent held Australian equities and 41.6 per cent held properties, making them the three biggest asset classes by quite a margin. Only 23 per cent had investments in international equities and only 9.6 per cent having international bonds with the barrier to investing internationally cited as cost.

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