High Net Worth (HNW) Asset Allocation Trends 2024
Summary
Drawing on our 2023 Global Wealth Managers Survey, this report analyzes HNW asset allocation strategies in 24 key markets. In particular, it examines the drivers behind investment choices now and over the next 12 months.
While 2024 holds out the promise of the first cuts to many key markets’ policy rates in the latter half of the year, both inflation and interest rates are forecast to remain elevated. Coupled with the enduring geopolitical risk from multiple wars and sluggish economies from China to Germany, and the outlook for 2024 is decidedly mixed.
Scope
- 94% of wealth managers see a significant risk of a financial market downturn over the next 12 months, making it one of the top threats to their business.
- Cash and near-cash products are expected to be the top draw for HNW investors in 2024 as caution prevails across all major markets.
- Bonds, commodities, and - for the first time in years - alternatives are all expected to lose portfolio share in 2024 as HNW investors remain committed to cash and begin rebuilding their equity holdings.
- Learn how inflationary fears and geopolitical upheaval have affected investment behavior in the HNW space.
- Discover the latest investment trends and adjust your service proposition based on a detailed understanding of HNW investors’ investment preferences.
- Determine how to best promote investment products by learning what is driving investment choices.
- Learn how and why investment preferences will change over the next 12 months.
- Understand the effect that increased volatility can have on investor behavior and how to minimize the risk of customers changing providers.
- Give your marketing strategies the edge required and capture new clients using insights from our data on HNW investment drivers.
- Overview
- Investment allocation in 2024
- Geopolitics is a less immediate threat but still dominates risk assessments
- A mirage of slowing inflation has emerged, to be followed by a new higher inflation regime
- Major regional GDP and inflation outlook
- Evolution of household sector (including HNW) investing across the globe
- Deposits took a hit in 2022 but are recovering
- Financial markets remain a major concern for wealth managers' fee incomes
- Broad HNW Asset Allocation
- Regional investment preferences
- Equities remain well down from previous heights
- After a big shift towards investment funds in 2022, the market has corrected
- HNW investors look set to hold tight to the same assets in 2024
- Caution prevails in Europe, and few big shifts are forecast
- Few see their clients pulling back from particular asset classes
- Investment Drivers by Asset Class
- Cash and near-cash
- HNW investors are most reliant on asset managers in their equity allocations
- Much of the bond portfolio is direct-holding
- REITs have increasingly won over private wealth managers
- Alternative investments are being reshaped by technology
- Managing investor appetite for crypto will be a major issue in 2024
- Alternatives
- Commodity prices have fallen but are still above pre-COVID-19 levels
- Commodities investments are driven by the recent bout of inflation
- ESG
- Key takeouts
- Appendix
- Methodology
- Secondary Sources and Further Reading
Research Assistance
Download our eBook: How to Succeed Using Market Research
Learn how to effectively navigate the market research process to help guide your organization on the journey to success.
Download eBook