High-net worth investors game for more risks on positive cues

With confidence returning to global markets, albeit in baby steps, high-net worth investors may be willing to take more risks than in the recent past, say analysts.

"With market sentiment turning more positive in recent months, as well as an increasing amount of economic and corporate data surprising on the upside even if still at recessionary levels, we have seen private clients becoming more willing to take some risk in their portfolios," Roberta Gamba, Head of Portfolio Construction Emea for JP Morgan's Private Bank, told Emirates Business.

"The main flow has been out of cash and government bonds into a variety of risky assets where opportunities are more evident," she said.

A recent survey by Barclays Wealth of about 2,100 high-net worth individuals reveals that a lot of money is waiting to be invested into the markets. When asked for their view on opportunities in the current market, investors in the US (29 per cent), the UK (26 per cent) and the UAE (21 per cent) were the most optimistic, saying there were significant investment opportunities.

"Money is starting to flow back into the markets, with a net positive figure for inflows year-to-date worldwide," said Firas Mallah, Head of the Middle East Office for Dexia Asset Managament. "Globally, over the past quarter, there has been an increasing appetite for bonds and money market funds, with appetite for equities starting to recover in the last month."

The Barclays report gauges what changes investors plan to make to their portfolios in the next 12 months. UK investors (37 per cent) were most likely to increase the level of risk in their portfolios, followed by the UAE (36 per cent) and Hong Kong respondents (33 per cent).

Keep up with the latest business news from the region with the daily Emirates Business 24|7 newsletter. To subscribe to the newsletter, please click here.