SOUTHAMPTON, England, October 12, 2011 /PRNewswire/ --
UK millionaires seek investment balance in face of economic instability
- With Photo
Government policies, a possible share market crash and Britain's economic uncertainty are the three primary perceived risks that UK Millionaires have for their wealth, according to research commissioned by investment firm Skandia for its Millionaire Monitor report (http://www.skandia.co.uk/millionaire-monitor).
Almost four out of five (78%) of UK millionaires feel the economic crisis has changed the investment landscape and around two thirds (65%) say it has changed their expectations for future investment returns. As a result, UK millionaires are spreading their money across a mix of investments in order to diversify their risk, with property accounting for a third of their wealth. This is significantly more than any other investment type, with cash accounting for a fifth, shares a sixth and managed investment funds a seventh.
Male millionaires take more risk with their wealth than female millionaires, with men holding half as much again in shares and managed investment funds than women. Whereas women hold more cash than men, and are also twice as likely to invest in art, antiques, collectibles and precious metals like gold and silver.
Invest like a millionaire
Looking forward, millionaires look set to continue their love affair with property with a third saying they are planning to increase their investment in property over the next 6 months. A third will also be looking to benefit from the stock market by increasing their equity investments over the next six months and one in five will be increasing their holdings in managed investment funds over the same period.
However, a significant proportion remains cautious. More than a quarter will be increasing their holdings in cash, 15% turning to fixed interest and 11% focusing on commodities such as gold and silver.
Female millionaires are more positive about property as an investment with four out of 10 (41%) saying they are likely to increase their exposure to property investments over the next six months compared to just over a quarter (27%) of male millionaires. Conversely, men strongly favour shares with two out of five (39%) looking to increase their exposure to the stock market compared to just one out of five (21%) women.
Outlook for next 12 months
Given the current economic uncertainty around the world, more millionaires have a negative outlook for the next 12 months than a positive outlook. Almost half (46%) believe the general economic situation in this country over the next 12 months will get worse compared to just over a third (35%) who believe it will get better. One in five (20%) think the economic situation will stay the same.
However, millionaires are almost equally divided in their opinion of how it will impact their household. Exactly a third (33%) believe the financial situation of their household will get worse but 34% believe it will get better and the same proportion again (34%) think it will stay the same.
Graham Bentley, Skandia's investment expert, comments:
"People might assume that a lot of millionaire wealth is 'old money' and hence it would be natural for a lot of it to be tied up in property. However, that is not the case. Nearly half of millionaires say their wealth has been earned from employment income with only 14% having inherited it. This shows that property is genuinely an investment that millionaires feel comfortable with and this looks set to continue. However, it looks like millionaires will also be looking to benefit from depressed stock market valuations to increase their wealth over the next six months. As with any investment portfolio it is important to ensure you have a good mix of investment types to diversify risk but now does feel like a good time to copy millionaires and invest in equities if you are taking a long term view."
The full 'Skandia Millionaire Monitor' report can be accessed via the following link: http://www.skandia.co.uk/millionaire-monitor
Notes to editors
Skandia UK is the largest retail investment platform operator in the UK with £35.3 billion funds under management (30.06.2011). This scale enables Skandia to agree lower fund management charges with fund groups and offer a wide range of high value investment solutions to investors which put them in control of their finances. This investment platform is underpinned by Skandia's award winning support and service.
Skandia UK is part of the wealth management business of Old Mutual plc, a leading international long-term savings group with £302.8 billion of funds under management (30.06.2011).
This press release is for journalists only and should not be relied upon by financial advisers or customers.
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