The ultra wealthy have long been perceived as very sophisticated investors, and on the cutting edge of investing trends. In fact, they’ve often been compared to institutional investors. So where are they putting their dough in 2012? Not under their mattresses.
According to the Institute for Private Investors’ annual Family Performance Tracking survey, more than a third, or 36 percent, of ultra-high-net-worth investors plan to scale back their allocations to cash. They’re also dialing back their U.S. equity exposure for more commodities, with 48 percent planning to boost this allocation, and real estate, with 45 percent planning to increase, IPI said. IPI surveyed its national membership of 1,100 UHNW investors, with member families having minimum investable assets of $30 million.
Fifty five percent of the families surveyed said they plan to increase direct investments in private companies. They’re also bullish on tangible assets such as gold, land, artwork and real estate.
“The common refrain we’re hearing from investors this year is that they’re decreasing their exposure to public markets and relying less on financial instruments and trading strategies,” said Charlotte Beyer, IPI founder and CEO. “Many investors are continuing to position themselves defensively.”
But at an economic forum yesterday, speakers said stock prices are likely to surprise on the upside this year, and many asset managers say valuations are good. At least the UHNW investors plan to put some of their assets to work, good news for their advisors.