World's richest families fret about geopolitics, climate change

By Carolyn Cohn LONDON (Reuters) - The world's richest families are worried about the U.S.-China trade spat, Brexit, populism and climate change and are keeping more of their money in cash, according to a survey of family offices by the world's largest wealth manager. Forty-two percent of family offices - set up to manage the wealth of one or more rich families - have increased their cash piles this year, according to the survey of 360 family offices by Swiss bank UBS and Campden Wealth Research. Total cash reserves were 7.6% of family office investments in 2019, up 70 basis points from a year earlier.

Reuters September 24, 2019 07:10:55 IST
World's richest families fret about geopolitics, climate change

Worlds richest families fret about geopolitics climate change

By Carolyn Cohn

LONDON (Reuters) - The world's richest families are worried about the U.S.-China trade spat, Brexit, populism and climate change and are keeping more of their money in cash, according to a survey of family offices by the world's largest wealth manager.

Forty-two percent of family offices - set up to manage the wealth of one or more rich families - have increased their cash piles this year, according to the survey of 360 family offices by Swiss bank UBS and Campden Wealth Research.

Total cash reserves were 7.6% of family office investments in 2019, up 70 basis points from a year earlier.

Fifty-five percent of family office executives expect recession to begin by next year, 63% believe Brexit is negative for Britain as an investment destination in the long term and 84% think populism will not fade by next year.

"Family offices are taking a dim view of geopolitical events," Sara Ferrari, head of UBS’ Global Family Office Group, told Reuters.

Fifty-three percent of family offices see climate change as the single greatest threat to the world, with newer generations running the family money putting sustainable investing high on the agenda, the survey said.

Family offices' views did not necessarily differ from those of institutional investors - pension funds, insurers and sovereign wealth funds - or of the asset managers who help invest their money, Ferrari said.

But family offices had more flexibility in their investments, were less tied to specific benchmark indices and tended to invest more in illiquid long-term assets, she said.

Private equity was the second largest investment class in 2019 behind developed market equities. Family offices said they plan to focus more on private equity next year - buying stakes in unlisted companies or the funds which invest in those companies - with a particular interest in technology firms.

Direct private equity investment achieved the best returns for the families this year, at 16%.

The family offices overall had a return of 5.4%, based on different methodology from previous surveys, and compared with a 2.2% drop in the MSCI All Country World Index <.MIWD00000PUS> in the 12 months to May 2019.

The surveyed firms manage a total of $330 billion in assets.

(Reporting by Carolyn Cohn; Editing by Lisa Shumaker)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

France confirms it will read black boxes of downed Ukrainian jet, Canada to help
World

France confirms it will read black boxes of downed Ukrainian jet, Canada to help

By Tim Hepher and David Ljunggren PARIS/OTTAWA (Reuters) - France said on Friday it would download the black boxes from a Ukrainian airliner downed by an Iranian missile in January, easing a stand-off over where they should be read. France's BEA crash investigation agency said it was acting at the request of Iran, which remains responsible under global rules for conducting a formal accident probe after acknowledging that the Boeing 737 was downed by its forces

Texas and Florida crack down on bars, reversing coronavirus reopening
World

Texas and Florida crack down on bars, reversing coronavirus reopening

By Brad Brooks LUBBOCK, Texas (Reuters) - With new coronavirus cases surging in Texas and Florida, officials in both states on Friday ordered bars to close again and imposed tighter restrictions on restaurants, setting back efforts to reopen their economies. Governor Greg Abbott gave bars in Texas until midday Friday to shut, while Florida's Department of Business and Professional Regulation told bars to immediately stop serving alcohol on their premises

U.S. Senate backs bill to punish China over Hong Kong
World

U.S. Senate backs bill to punish China over Hong Kong

By Patricia Zengerle WASHINGTON (Reuters) - The U.S. Senate passed legislation on Thursday that would impose mandatory sanctions on people or companies that back efforts by China to restrict Hong Kong's autonomy, pushing back against Beijing's new security law for the city. The measure also includes secondary sanctions on banks that do business with anyone found to be backing any crackdown on the territory's autonomy, potentially cutting them off from American counterparts and limiting access to U.S.