Wealth in Hong Kong: HNW Investors 2016; Understanding HNW investors and wealth management strategies.

Publisher Name :
Date: 31-Aug-2016
No. of pages: 42

Summary

The Hong Kong private wealth market is an attractive mix of East and West. Its long-established nature makes it larger and more diversified than is common in the rest of Asia Pacific. Local HNW investors have mainly sourced their wealth through a mixture of entrepreneurship and earned income. An expectation of better returns through advisors is driving uptake of professional advice, but investors are reluctant to relinquish control completely, preferring advisory mandates. The average portfolio is heavily invested into equities, and this is not expected to change. However, we forecast rising demand for alternative products, which currently only constitute a minor proportion of the typical HNW portfolio. HNW clients also show moderate to strong demand for financial and pension planning, while estate planning continues to be a service that is sold rather than bought.

Key Findings


  • Family business owners and first-generation entrepreneurs together form the largest HNW client segment in Hong Kong. Wealth managers need to be prepared for clients with irregular incomes, heavy exposure to single industries, and finances entwined with their business.

  • Expats constitute a sizable proportion of the local HNW market and should prove to be a lucrative target segment.

  • Advisory mandates continue to dominate in Hong Kong. However, HNW investors prefer to manage simple investments themselves.

  • The average portfolio is heavily exposed to equities, while only the bare minimum is held in cash and near-cash products to ensure liquidity.

  • Already moderate to strong demand for margin lending is forecast to increase even further, and wealth managers should ensure that clients understand the risks associated with a leveraged investment strategy.


Synopsis

Verdict Financial's "Wealth in Hong Kong: HNW Investors 2016" report analyzes the investing preferences and portfolio allocation of HNW investors in Hong Kong. The report is based on our proprietary Global Wealth Managers Survey.

Specifically the report:


  • Profiles the average HNW investor in Hong Kong in terms of their demographics and analyzes the expat opportunity in the country.

  • Analyzes which wealth management mandates are preferred among HNW investors in Hong Kong and how demand will develop going forward.

  • Examines the allocation of HNW investors' portfolios into different asset classes and how the allocation is expected to develop in the future.

  • Analyzes product and service demand among HNW investors in Hong Kong.


Reasons To Buy


  • Develop and enhance your client targeting strategies using our data on HNW profiles and sources of wealth.

  • Give your marketing strategies the edge required and capture new clients using insights from our data on HNW investors' drivers for seeking investment advice vs. self-directing.

  • Tailor your investment product portfolio to match the current and future demand for different asset classes among HNW individuals.

  • Develop your service proposition to match the product and service demand expressed by HNW investors in Hong Kong and react proactively to the forecasted change in demand.


Companies Mentioned


  • Credit Suisse

  • BNP Paribas Wealth Management

  • HSBC

  • Vontobel

Wealth in Hong Kong: HNW Investors 2016; Understanding HNW investors and wealth management strategies.

Table of Contents

Executive Summary
The HNW market in Hong Kong is well diversified and attractive in its own right
Key findings
Critical success factors

Profiling HNW Consumers In Hong Kong
Entrepreneurs represent an important segment of Hong Kong's HNW market
In a diversified market, first-generation entrepreneurs and family business owners still need particular attention
HNW individuals have built their fortunes through manufacturing and the financial services industry
Wealth managers should be prepared to cater to the distinct needs of Hong Kong's large expat community
HNW expats represent a lucrative target market in Hong Kong
Uncertainty if they will return to their country of origin motivates HNW expats to invest locally

HNW Investment Style Preferences
A multi-asset management strategy is key in Hong Kong
HNW investors in Hong Kong expect better returns through advisors
The largest proportion of HNW wealth is kept in advisory mandates
Advisory mandates are set to remain the preferred type of asset management
Demand for advisory and discretionary services is on the rise
HNW investors prefer to manage simple investments themselves

Understanding Asset Allocation Trends Among HNW Individuals In Hong Kong
Hong Kong's love affair with equities is set to continue
Equities dominate the typical HNW portfolio, and this is not expected to change
Equities constitute almost two thirds of HNW investors' managed wealth
Bonds constitute the second-largest asset class
Cash and near-cash investments constitute a significantly smaller proportion in Hong Kong than in the wider region
Property constitutes only a minor proportion of the typical HNW portfolio
Commodity investments are of little interest to HNW clients
Alternatives only constitute a small proportion of the typical HNW portfolio
Dissatisfaction with traditional asset classes is driving demand for alternatives

HNW Product and Service Demand
Planning services
Financial and retirement planning should be an integral part of a wealth manager's offering
With the exception of inheritance planning, demand for all planning services is forecast to increase
Current market conditions mean that property advice is of little interest to HNW investors
Positive lending conditions are driving demand for credit in China
HNW demand for margin lending will continue to rise

Appendix
Abbreviations and acronyms
Definitions
Affluent
HNW
Liquid assets
Mass affluent
Methodology
Verdict Financial's 2015 Global Wealth Managers Survey
Verdict Financial's 2014 Global Wealth Managers Survey
Bibliography
Further reading
About Verdict Financial
Disclaimer

List of Figures

Figure 1: Wealth managers should be prepared to cater to Hong Kong's large business owner community
Figure 2: BNP Paribas targets entrepreneurs in Hong Kong
Figure 3: Financial services represents an important driver of the economy and wealth in Hong Kong
Figure 4: Expats are an important part of the HNW community in Hong Kong
Figure 5: Hong Kong attracts expats from various regions, but China stands out
Figure 6: HNW expats invest locally as they are unsure if they will return to their country of origin
Figure 7: An expectation of better returns is driving uptake of financial advice
Figure 8: The majority of HNW wealth is kept in advisory mandates
Figure 9: Demand is strongest for advisory and discretionary mandates
Figure 10: Demand for advisory and discretionary asset management is forecast to increase significantly
Figure 11: Vontobel's private banking app allows clients to trade remotely
Figure 12: Investors feel confident enough to manage simple investments themselves
Figure 13: HNW investors are heavily exposed to equities
Figure 14: HNW investors prefer equity funds over direct holdings
Figure 15: Capital appreciation opportunities is the number one driver of equity investments
Figure 16: HNW investors allocate 23% of managed wealth to fixed income products
Figure 17: Demand for fixed income products is set to decrease
Figure 18: Only 5% of managed HNW wealth is held in cash products
Figure 19: HNW demand for cash products will continue to fall
Figure 20: 4% of HNW wealth is allocated to property
Figure 21: A weak property market will see real estate investments fall
Figure 22: Commodities are of little interest to HNW investors in Hong Kong
Figure 23: Commodity investments are forecast to decrease
Figure 24: Hedge funds are the preferred alternative investment product
Figure 25: Dissatisfaction with other investments is driving HNW demand for alternatives
Figure 26: Financial and pension planning is the core of a wealth manager's appeal
Figure 27: HSBC supports HNW investors over generations
Figure 28: With the exception of inheritance planning, all types of planning will see a marked increase in demand from HNW investors
Figure 29: HNW investors show moderate to strong demand for margin lending
Figure 30: Demand for margin loans is forecast to increase

  • Wealth in India: Sizing the Market Opportunity 2016
    Published: 23-Nov-2016        Price: US 3450 Onwards        Pages: 42
    Summary Driven by economic performance, over the past few years the Indian wealth market has impressed with strong growth rates, which are expected to continue to 2020. India currently holds the crown as the world's fastest growing major economy and, as such, it is beginning to positively distance itself from Brazil, Russia, and China. This, aligned with the substantial Indian population, underlines the huge potential of the market for wealth managers. ......
  • China Wealth Report 2016
    Published: 18-Nov-2016        Price: US 4995 Onwards        Pages: 88
    Synopsis This report reviews the performance and asset allocations of HNWIs and ultra-HNWIs in China. It also includes an evaluation of the local wealth management market. Summary This report is the result of WealthInsight's extensive research covering the high net worth individual (HNWI) population and wealth management market in China. Scope Independent market sizing of the Chinese HNWIs for fi......
  • Wealth in the UK: Competitive Dynamics 2016
    Published: 03-Nov-2016        Price: US 3450 Onwards        Pages: 39
    Summary Since the introduction of the Retail Distribution Review (RDR) in 2012, the UK wealth management competitive landscape has undergone a steady evolution. New business models have emerged as both new and established players seek ways to address the range of financial demands of retail, mass affluent, and cost-conscious high net worth (HNW) individuals. Several digital platforms have launched in the UK market in 2016, ranging from extensions of traditional wealth......
  • Wealth in Belgium: Sizing the Market Opportunity 2016
    Published: 02-Nov-2016        Price: US 3450 Onwards        Pages: 41
    Summary Wealth market growth in Belgium has experienced a slowdown in 2016 following the terrorist attacks and Brexit. Combined with the volatility of the stock market, Belgian individuals have been driven to adopt cautious investment strategies. Nevertheless, future growth will be driven by mutual funds. The increase in their popularity in a sector where asset allocation is dominated by deposits can be attributed to their balanced and fixed income strategies. ......
  • HNWI Asset Allocation 2020
    Published: 31-Oct-2016        Price: US 3800 Onwards        Pages: 66
    Synopsis This report looks at a detailed breakdown from WealthInsight's proprietary country report model of HNWI population and wealth. It provides an analysis of HNWI demographics based on a unique analysis of HNWI dossier database. It analyses trends in HNWIs investment by asset class and looks at a breakdown of foreign and alternative investments. It provides an in-depth analysis of competitor product strategy, mergers and acquisitions, and innovation and ident......
  • Wealth in Taiwan: Sizing the Market Opportunity 2016
    Published: 29-Oct-2016        Price: US 3450 Onwards        Pages: 43
    Summary A plunge in stock market performance and weak economic data took a toll on Taiwanese wealth generation in 2015. However, a robust equity market recovery in 2016 has boosted the retail savings and investment market, with gains of almost 10% on the Taiwan Futures Exchange in the first nine months of 2016. Between 2016 and 2020, Taiwan's retail investment market is forecast to record a compound annual growth rate (CAGR) of 4.9%. Key Findings......
  • Wealth in South Africa: Sizing the Market Opportunity 2016
    Published: 28-Oct-2016        Price: US 3450 Onwards        Pages: 35
    Summary South Africa is currently navigating a turbulent course of political, economic, and financial uncertainties that are seriously undermining future prospects. Low economic growth, high inflation, currency devaluation, and the threat of a further downgrade of the country's national credit rating to "junk" are hampering the South African wealth market. Political tensions are increasing investor nerves, making it a vital time for wealth managers to guide their clie......
  • Challenges and Opportunities for the Wealth Sector in Malaysia 2016
    Published: 27-Oct-2016        Price: US 1995 Onwards        Pages: 41
    Synopsis This report is a thorough analysis of Malaysia Wealth Management and Private Banking sector, and the opportunities and challenges that it faces. Summary This report is the result of WealthInsight's extensive research covering the high net worth individual (HNWI) population and wealth management market in Malaysia. The report focuses on HNWI performance between the end of 2011 and the end of 2015. This enables ......
  • HNWI Asset Allocation in Malaysia 2016
    Published: 26-Oct-2016        Price: US 1995 Onwards        Pages: 54
    Synopsis This report provides the latest asset allocations of Malaysia HNWIs across 13 asset classes. The report also includes projections of the volume, wealth and asset allocations of Malaysia HNWIs to 2020 and a comprehensive and robust background of the local economy. Summary This report is the result of WealthInsight's extensive research covering the high net worth individual (HNWI) population and wealth management market i......
  • SERVICES
    Value for Money
    We believe in "optimum utilization of available budget and resources". While servicing our clients' (your) market research requirements, we keep the same approach in focus to help you get the best value for your $$s.
    Ever Growing Inventory
    Ranging from the smallest feasible / required data (datasheets, data facts, SWOT analysis, company profiles, etc) to full research reports that help you make decisions, our inventory is updated almost on a daily basis with the latest industry reports from domain experts that track more than 5000 niche sectors.
    One Stop Solution
    Need a custom research report on medical devices market? Require all available business intelligence on 3D printing industry? Exploring F&B sector of a particular country/region? RnRMarketResearch.com is your one-stop-solution to all market intelligence needs. We not only offer custom research and consulting services, we also "bundle" reports to meet your needs and help you fetch the data analysis you require for your business.
    Dedicated Client Engagement
    Not limited to only "finding" relevant reports for you, our client engagement team dedicates its efforts to understand your "business need" and accordingly maps available research data to help you move forward. Call "your" client engagement executive any time of your day and get your questions answered in order to make the correct business decision.
    Saving Time and Efforts
    Simply share your research requirement details with us and let us do all the hard work to find required intelligence for you. When you add up our "one stop solution" and "dedicated client engagement" services mentioned above, you obviously know the time and effort saving you do by working with us.
    Payment Flexibility
    Working with Fortune 500 organizations, we understand the importance of being flexible for payments. Share your payment terms with us and we will surely match up to them to ensure you get access to required business intelligence data without having to wait for the payment to be done.
    Post-Purchase Research Support
    Have questions after reading a report / datasheet bought through us? Not sure about the methodology used for data available in the research? Talk to us / Share your questions with us and if required, we will connect you with the analyst(s)/author(s) of the report(s) and ensure you get satisfactory answers for the same. Need more data / analysis / report(s) on the topic of your research/project? The RnRMarketResearch.com team is here for you 24X7 to support you with your post-purchase requirements. Subscription Offers & Packages (Get in touch with us for more details - sales@rnrmarketresearch.com / +1 888 391 5441 )
    • Ad Hoc
    • Pay - as - you - go / Bucket Subscriptions
    • Fixed Cost for #of reports
    • Customize / Personalize as per your needs