World's Rich Confident They Can Scale Wall of Global Risk
The global economic, financial and political landscape has never been shakier, but the world's rich are confident they can steer through the fog of uncertainty in the coming year "without so much as a dent in their finances", a survey showed on Wednesday.
The findings of UBS Wealth Management's survey of more than 2,800 millionaires in seven countries show a high degree of worry about the global financial system on the one hand, and supreme self-confidence and optimism on the other.
Some 82 percent of those surveyed said this is the most unpredictable period in history. More than a quarter are reviewing their investments and almost half said they intend to but haven't yet done so.
But more than three quarters (77 pct) believe they can "accurately assess financial risk arising from uncertain events", while 51 percent expect their finances to improve over the coming year compared with 13 percent who expect them to deteriorate.
More than half (57 pct) are optimistic about achieving their long-term goals, compared with 11 percent who are pessimistic. And an overwhelming 86 percent trust their own instincts when making important decisions.
"Most millionaires seem to be confident they can steer their way through the turbulence without so much as a dent in their finances," UBS WM said.
"They identify economic and financial risks as their big concerns and they have serious doubts about the world's corporate and financial system. And yet, they stride into the future with assurance," the report said.
Among the other findings, 68 percent say they suffer from "information overload" as they make their investment decisions, and nearly three quarters (72 pct) say short-term distractions get in the way of their financial plans.
Still, the report highlighted some aspects of their investment behavior that could ultimately work against them. For instance, 75 percent of those surveyed see cash as a safe option, "even though it will perform poorly compared with other asset classes in the context of rising inflation."
Perhaps surprisingly, younger millionaires are more risk-averse than their older peers. Nearly half of the 18-34 year old group are less willing to take risks after the financial crisis, compared to less than 30 percent of the over-65 bracket.
The study surveyed 2,842 millionaires, with investable assets of at least $1 million, in Hong Kong, Japan, Singapore, Mexico, Italy, Switzerland and Britain.
(Reporting by Jamie McGeever; Editing by Ralph Boulton)