World Wealth Report

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Overview

 

Fast-Breaking Headlines

The world’s population of High Net Worth Individuals (HNWIs) continues to increase strongly in 2004 with 7.3% growth.

North American HNWI population and their wealth surpasses Europe for the first time since 2001 and Asia Pacific shows impressive growth rates.

HNWI investor behaviors in 2004 were characterised by stabalisation, risk management and a regained interest in private equity.

Unique wealth segment “mid-tier millionaires” increasingly need specialty services with the benefits of a family office at affordable prices.

Many High Net Worth Individuals Claim They Lack The Tools And Resources To Effectively Manage Their Wealth

It’s Expensive To Be Rich, And Getting More So Every Day

From the World Wealth Report

As in 2003, for the second year in a row, 2004 saw a strong economic growth in most parts of the world. While stock market performance in the developed economies tended to moderate year-over-year, rising oil prices and demand for commodities fueled dramatic HNWI gains in many of the emerging markets. Strongly driven by North America and Asia-Pacific, the growth of the HNWI population worldwide remained strong, in the high single digits.

In terms of investment strategies and asset allocation, HNWIs reacted to a recovering economy. Equity, fixed income and cash/deposits allocations remained stable, whereas an increased appetite in private equity was noticed.

Our spotlight on the “mid-tier millionaires,” those with US$5-30 million in financial assets highlights their unique plight: Faced with complex wealth management needs and responding to this complexity by hiring more and more advisers, mid-tier millionaires are finding it increasingly difficult to manage their managers. We predict that, to effectively and profitably serve this growing market segment, financial services firms will need to create “virtual service networks” using new applications of technology and the internet to bring family office-like services downstream and simplify the lives of mid-tier millionaire clients.