The world’s ultra-rich lost a small fortune in 2022 as energy, the economy, and geopolitics combined in a triple shock. Ultra-high-net-worth individuals (UHNWIs) lost 10 per cent of their combined wealth of US$101.5 trillion, a loss of more than $10 trillion, says Knight Frank’s latest annual ‘Wealth Report.’ Europe’s ultra-rich saw the largest negative impact of the triple shock ‒ a 17 per cent change in their aggregate wealth ‒ while those in Oceania (-11 per cent), the Americas (-10 per cent), the Middle East and Asia (both -7 per cent), and Africa (-5 per cent) were impacted less. The research shows that a third of total wealth among UHNWIs was in residential property, just over a quarter in equities, and 21 per cent in commercial property. Gold (three per cent) and cryptos (two per cent) made up a small portion of assets. For a better outcome in 2023, UHNWIs will be adjusting their investment decisions with capital appreciation the main goal cited (31 per cent) above capital preservation (26 per cent), income generation (23 per cent), and diversification (14 per cent). Almost half plan to boost investment portfolios and/or cash reserves this year, while 17 per cent and 23 per cent plan to reduce these. More plan to reduce debt (29 per cent) than increase it (27 per cent), reflecting the current higher cost of borrowing.
- PWC